Actions Aim to Open Credit Scores

The California Legislature and two credit bureaus have taken steps to give consumers access to their credit scores.

The state Senate on Thursday approved a bill sponsored by Sen. Liz Figueroa (D-Fremont) that would require lenders to provide consumers with their scores, which are used widely in evaluating loan applications but which are typically kept secret from consumers. Lenders would also be required to disclose what credit information was used to create the score and how credit scoring is used in evaluating loans. The bill now moves to the Assembly for consideration.

Consumer advocates and some lenders have criticized credit scoring companies, including industry leader Fair, Isaac & Co., for keeping scores secret. Fair, Isaac blocked efforts by E-Loan, a lending Web site, to reveal scores to consumers, saying the access violated contracts the credit scorer had with credit bureaus to keep the information secret.

Meanwhile, credit bureaus Experian and Trans Union said they are developing their own credit scoring systems and would reveal the resulting scores to interested consumers. The scores would not be the same ones created by Fair, Isaac or currently used by lenders, and it is unclear how accurately the scores would reflect consumers’ credit situations.

For more information on credit scoring, visit https://www.latimes.com/moneytalk.