CFPB: Credit Report Disputes More Common in Minority Neighborhoods
The Consumer Financial Protection Bureau released research reporting consumers in majority Black and Hispanic neighborhoods, as well as younger consumers and those with low credit scores, are far more likely to have disputes appear on their credit reports.
“Families living in majority Black and Hispanic neighborhoods are far more likely to have disputes of inaccurate information appear on their credit reports,” said CFPB Director Rohit Chopra. “Error-ridden credit reports are far too prevalent and may be undermining an equitable recovery.”
The report said majority Black and Hispanic neighborhoods continue to face significant challenges with credit records. In nearly every credit category reviewed (auto loans, student loans, credit cards and retail cards), consumers residing in majority Black areas were more than twice as likely to have disputes appear on their credit reports compared to consumers residing in majority white areas.
For auto loans, consumers in majority Black areas were more than three times as likely to have disputes appear on their credit reports (0.8% of accounts with disputes in majority white census tracts compared to 2.8% of accounts in majority Black census tracts).
The research is a part of a series of CFPB reports focusing on trends in the consumer financial marketplace, and uses data on auto loan, student loan and credit card accounts opened between 2012 and 2019.
The report can be found here.