The COVID-19 pandemic spread across America. States rushed to help consumers left in the cold by the federal response. Many states made local changes to the credit reporting statutes. It all seemed to be a win for consumers, many whom lost jobs. However, courts recently ruled that the FCRA preempts state rights in these situations.
As the National Law Review reports, federal courts recently sided a with trade association that argued the FCRA preempts state regulations. This is response to what some have perceived as state over-reach when it comes to handling the pandemic. The FCRA remains the law of the land.
Thankfully, the CARES act did offer some protection for consumers, but not all are being followed carefully by the credit reporting agencies or lenders. Lenders continue to falsely report forbearance and zombie debt is at a seven year high. With this kind of activity looming large, understanding how the FCRA protects consumers is a must.
Monitoring Your Credit during COVID-19
As federal courts have ruled that the FCRA preempts state changes to the law, keeping fundamental monitoring is crucial heading into 2021.
Here are a couple tools that will help you monitor your credit to ensure nothing is reporting incorrectly.
- Credit Karma – This tried and true website offers free credit monitoring of your Transunion and Equifax reports. There is a lot of advertising and it can be cumbersome to navigate but the email alerts are worth the effort.
- myFico – A great mobile app that also provides good credit monitoring, but it is not free. What this does provide is nearly 40 different variations of the FICO score, so consumers can make smarter choices while applying for credit.
- Annual Credit Report – The CARES act allows consumers to obtain all three credit reports once a week. This is a no-brainer! A service that was once one a YEAR is now weekly. Who said everything in a pandemic is negative?
