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Bryan P. Keenan

The different three years can make

Apparently, Equifax was not content with the image problems created by the fallout that followed their hacking controversy in September. The prominent credit-reporting agency made what they likely considered a recently discovered, small change that had a huge impact on hundreds of thousands of consumers.

Without announcing the policy shift, Equifax decided to enhance the penalty for those who filed Chapter 13 bankruptcy.

The Chapter 13 bankruptcy process provides debt forgiveness after five years of repayments by filers. The policy of TransUnion and Experian was to place flags on their credit reports for seven years. Equifax’s policy veered from their counterparts by adding three years to those who failed to complete the five years of repayments, yet still had cases dismissed.

Consumers operated under the assumption that the flag would disappear after the requisite seven years. Yet, they found themselves still turned down for everything from apartments to jobs, particularly if credit reports were only pulled from Equifax.

Those three years made a difference, considering that half of Chapter 13 filings end up being dismissed due to debtors missing payments. Between 2008 and 2010 alone, bankruptcy judges dismissed 574,000 Chapter 13 plans.

Simply put, Equifax’s decade-long punitive measures blindsided and negatively impacted a little more than half a million consumers.

After ProPublica contacted Equifax this past summer regarding the disparity, a spokesperson asserted that the flag had recently returned to a seven-year time span for all types of Chapter 13 filings. However, the individual speaking for Equifax would not define what “recently” meant, nor would they cite a reason for the change.

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Bryan P. Keenan & Associates, P.C.

993 Greentree Road
Suite 101
Pittsburgh, PA 15220

Phone: 412-923-4941
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