Are you paying too much for auto loans and insurance? You may, and it’s likely that you never even knew it. That’s because 5 percent of U.S. consumers may have an error on their credit report that could leave them paying higher premiums for everyday products, according to a report issued this week by the Federal Trade Commission, a U.S. governmental agency.
The report, issued after years of study, is among the most in-depth and first of its kind to assess the accuracy of U.S. credit reports. “These are eye opening numbers for American consumers,” Howard Shelanski, director of the FTC’s Bureau of Economics told CNBC. “The results of this first-of-its-kind study make it clear that consumers should check their credit reports regularly. If they don’t, they are potentially putting their pocketbooks t risk.
Meanwhile, the Consumer Data Industry Association flipped the script. It spoke of the report’s positives. “The study showed that 95 percent of consumers are unaffected by errors in their credit report,” the association said a press release.
While 95 percent may seem like a high number, it’s simply not good enough. The 5 percent of Americans who are adversely affected likely equates to hundreds of thousands, if not millions, of people. The problem is that most people wouldn’t even know these errors exist had this first-of-its-kind report not been conducted. Americans are allowed to check their credit report for free once a year. If they check it more than that it costs. The fees alone will likely discouraged people from constantly monitoring their scores. And one also wonders if checking it once a year is the same as due diligence. These mistakes need to be cleared up immediately.