What do “goodwill adjustments” of a credit report and Slenderman have in common?

It appears they are both legends born from the internet.

It appears this is a common recommendation that the internet makes to consumers seeking to improve their credit score. Here is one such article from NerdWallet. Here’s another from The Balance. While these webpages indicate that creditors are likely to decline and cite the Fair Credit Reporting Act (FCRA) as their reasoning, the webpages often recommend that consumers persist and try to “wear them down.”

The NAFCU Regulatory Compliance Team has had a variety of questions in the past several months about removing negative reporting from a member’s credit report. This is not addressing inaccurately reported or disputed information about an account, but removing truthful, accurate reporting that has a negative effect on a consumer’s credit score. Sometimes this request comes in the form of letters from third parties who claim to be helping the member fix their credit. Sometimes it is a conversation that the credit union is having in the context of working out a default loan. Sometimes the member simply asks nicely or sends in something printed from the internet. Credit unions almost always want to help or accommodate a member when possible.

Unfortunately, removing accurately reported negative information isn’t up to the credit union. Section 623 of the FCRA requires any credit union that furnishes information to a consumer reporting agency (CRA) to provide accurate information. Paragraph 623(a)(1)(A) explicitly prohibits furnishing any information relating to a consumer “if the person knows or has reasonable cause to believe that the information is inaccurate.” This is true regardless of whether it would be helpful or harmful to the consumer.

 

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