Banks and State Government and Banking & Finance and Legislation and Government & Economic Development and Government and Loans

Bill meant to protect credit scores considered by committee

January 13, 2014

Credit score disclosures and credit inquiries were the focus of the Indiana Senate Commerce, Economic Development and Technology Committee’s discussion Monday of Senate Bill 175.

Sen. Patricia Miller, R-Indianapolis, said she filed the bill after numerous people told her they had problems with the accuracy of their credit reports and credit scores.

“There should be a way for Hoosier consumers to have fair and accurate reports and scores,” Miller said.

The bill would restrict the use of credit checks in reducing credit scores.

“If you go to get a loan to buy a car it would be an inquiry, but it would not indicate whether or not you’re financially equipped for whatever you’re trying to purchase,” Miller said. “This process is causing citizens of Indiana, who through no fault of their own, have a poor score when they should have a positive score, and should also be able to take action accordingly.”

Dax Denton, of the Indiana Bankers Association, said he was concerned about a section of the bill that that would charge lenders with “a deceptive act” if they use a credit rating that has incorporated inquiries as part of their scoring.

“That would impact every bank in the state because banks use credit rates to gauge risks, and we need a way to gauge the perception on that risk or that borrower,” Denton said.

No decision was made on SB 175. The committee could take up the legislation as soon as next week.

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