Broker deals scuttled by credit bureau mistakes

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Clients facing increasingly tight deadlines to secure mortgages are getting tripped up by credit bureau mistakes that the industry is too slow in clearing up, say brokers.

“It’s not simple to get something removed (from a client’s credit report),” says Paul Mangion, a broker with The Mortgage Centre in Mississauga, Ont. “If your mortgage is closing in a month, it’s not an easy task.

“I’ve seen clients pay higher rates because of things (credit reporting agencies) have done, not necessarily errors but things that could be corrected.”

Those errors are something buyers in the GTA and other markets marked by multiple bids simply can’t afford. Even nationally, home sales rose more than 3 per cent in May over the year-ago period as the Western provinces rebounded. That competition within the market is forcing real estate transactions to happen over a few hours as opposed to a few days, making time of the essence.

A credit bureau mistake that almost cost one couple their first home was recently the focus of a Toronto Star report highlighting the difficulty in getting bureaus and creditors to correct their mistakes.

Sabeen Bubber, a mortgage professional with Verico Xeva Mortgage in Vancouver, says the reporting companies need to make it easier for clients to report inaccuracies or update their reports – a move that would expedite the process.

“I think that (credit reporting companies) need to accept certain things from consumers or hold creditors responsible for their reporting factors,” she says, adding that some creditors are less responsive to concerned calls from consumers. “If (the credit reporting company) calls the creditor they would pay more attention to it.”

John Panagakos, a broker with Dominion Lending Centres, says trying to right these inaccuracies with credit reporting agencies is especially frustrating for clients, who don’t understand how the error was made. These reporting agencies need to be held accountable for their operations, he says, which is a difficult task because they have such a monopoly on the market.

“Maybe it’s something we all have to address with the credit (reporting) companies,” he says, pointing to the lack of oversight and accountability within these companies. “We should have a liaison with (the credit reporting companies).”

Bubber says that accountability is especially important, given how reliant we are on credit.

“Our entire economy and our culture is based on credit,” she says. “(That’s why we need) a more compassionate body that looks after people’s credit.”

Until then, it’s likely these discrepancies are going to continue. For his part, Panagakos tells clients to document every interaction with the credit reporting company they use.

“First ask who you’re talking to, how long it will take to fix,” he says. “Get a time agreement down and document everything.”
  • Mike on 2015-06-30 9:35:00 AM

    Perhaps consumers need to pre plan purchasing a house. See a professional and get pre approved. Even run their own credit file ahead so they know it is accurate or they can work on repairing credit. It is scary today that someone will go out and buy a house without seeing about a mortgage first. Do these people really even deserve a home??

  • John Greenlee on 2015-06-30 10:33:56 AM

    The first step to buying a home should be to be pre-approved, properly with a full credit check.

  • Henry on 2015-06-30 1:15:12 PM

    Perhaps the clients need to hire good lawyers and sue Equifax to teach them like any other people they have to do their jobs correctly

  • Jeremy on 2015-06-30 2:20:37 PM

    Why is the owness on the customer? Shouldn't Equifax hold its membership accountable in order to maintain the integrity of the service? In my experience, Equifax is brutal at best.

  • Michael Mitchell on 2015-06-30 2:47:44 PM

    If done properly a report can be fixed in 5 days.

  • eCreditFix . ca on 2015-06-30 4:01:06 PM

    I've talked to many agencies about Equifax and TransUnion and the government's position is that it is up to the consumer to make sure their reports are correct, not the bank or the reporting agencies. I got so feed up with how difficult it is for the Average Joe to get their reports corrected that I focus full-time on fixing consumer's credit reports. I developed a system to help automate and make the credit fixing process easy and much quicker. I agree more should be done to improve the process for Canadians trying to fix it themselves but until that happens I can help.

  • Omer Quenneville on 2015-06-30 7:06:20 PM

    I advise people to do a "self-exam" (self credit check) once a year. Whether you are buying or not. A credit check should also be done before you sell as well if you are expecting to buy immediately after. As mortgage professionals I contact my clients once a year with the form from Equifax and Transunion and encourage them to send it in.

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