ChexSystems and Consumer Issues

ChexSystems is a nationwide “banking credit bureau” that keeps track of people’s checking and savings account history, especially problems with deposit accounts.​

What ChexSystems Does

ChexSystems is a specialty consumer reporting agency that collects negative information about deposit accounts, such as unpaid overdraft fees, bounced checks, involuntary account closures, and suspected fraud. Banks and credit unions use ChexSystems reports and scores to decide whether to approve you for a new checking or savings account.​

How It Affects You

If your ChexSystems report shows serious or repeated banking issues, a bank can deny your application for a new account or place restrictions on you. Negative entries typically stay on your ChexSystems file for about five years, which can make it harder to open regular bank accounts during that time.​

Your Rights

ChexSystems is covered by the Fair Credit Reporting Act, so you are entitled to a free copy of your ChexSystems report (usually once every 12 months) and you can dispute inaccurate information. If a bank denies you due to ChexSystems, you should receive an “adverse action” notice telling you which reporting agency was used and how to request your report.

ChexSystems has several common problems for consumers: inaccurate or outdated negative records, difficulty opening accounts because of a single mistake, and frustrating dispute or access processes.​

Typical Consumer Issues

• False or mistaken negative entries (like accounts that are not yours, paid debts still showing, or mis-labeled “account abuse”) can get people wrongly denied new bank accounts.​

• Negative items can linger for up to about five years, so even a resolved problem may keep causing denials if it is not updated or removed.​

Disputes And Reinvestigation

• Consumers often report that disputes take a long time, receive “generic” responses, or result in ChexSystems simply confirming what the bank reported without fully investigating.​

• If ChexSystems or the bank fails to correct clear errors, people may need to escalate with written disputes, complaints to regulators, or legal help under the Fair Credit Reporting Act (FCRA).​

Access And System Problems

• Some consumers have trouble even accessing their online ChexSystems portal or getting a copy of their report, which makes fixing problems harder.​

• Complaints describe being bounced between ChexSystems and other vendors or banks, with neither side taking responsibility for technical glitches or incorrect data.​

How These Problems Affect You

• Being flagged by ChexSystems can mean repeated denials for basic checking or savings accounts, forcing people into high‑fee alternatives and making everyday finances more difficult.​

• This can indirectly affect overall financial health, even though ChexSystems itself does not control traditional credit scores with Equifax, Experian, or TransUnion.​

If you are experiencing problems, get your free ChexSystems report, identify specific errors, dispute in writing with documentation, and consider talking with a consumer‑rights attorney if denials or errors continue.

What is Early Warning Services, LLC?

Early Warning (usually “Early Warning Services” or EWS) is a bank‑owned financial technology company and consumer reporting agency that tracks people’s checking and savings account activity and helps banks detect fraud and assess risk.​

What Early Warning Does

Early Warning collects information about your deposit accounts, such as account status, overdrafts, negative balances, unpaid fees, account closures, and suspected fraud or misuse. Banks and credit unions use this data to decide whether to open new accounts for you, keep existing accounts open, and to verify that deposits and payments are legitimate.​

Who Owns Early Warning

Early Warning is co‑owned by several of the largest U.S. banks, including Bank of America, Capital One, JPMorgan Chase, PNC, Truist, U.S. Bank, and Wells Fargo. It also owns and operates Zelle, the peer‑to‑peer payment network used by thousands of banks and credit unions.​

How It Affects Consumers

Early Warning works somewhat like a “banking version” of a credit bureau: banks pull an Early Warning report to see your banking history before approving a new checking or savings account. Negative data on that report can lead to denials or closures of bank accounts, even though it does not directly change your credit scores with Equifax, Experian, or TransUnion.​

Your Rights And Access

Because Early Warning is a consumer reporting agency, it is covered by the Fair Credit Reporting Act, which gives you the right to request a copy of your report and dispute inaccurate information. You can request your Early Warning consumer report directly from the company, usually once per year at no cost.

How It Can Harm You

Negative entries on an Early Warning report can cause banks and credit unions to:

• Deny new checking or savings account applications, even if your credit scores are good.​

• Close existing accounts or restrict services if they view you as a fraud or account‑management risk.​

• Treat you as higher risk for other products (like overdraft lines or some cards) because of unpaid fees, repeated overdrafts, or fraud flags.​

These denials and closures do not usually show up as “late payments” or “collections” on your regular credit report unless the bank separately sends an unpaid debt to collections, which can then appear with the credit bureaus and directly damage your credit scores.​

Indirect Damage To Your Credit

Early Warning can indirectly hurt your credit by making it harder to manage your finances smoothly:

• If you cannot open a mainstream bank account, you may rely on prepaid cards, check‑cashing, and high‑fee services, making it easier to miss bill payments or fall behind on debts that do report to credit bureaus.​

• If a bank closes an account with a negative balance and sends that balance to a collection agency, that collection can be reported to the credit bureaus and lower your credit scores.​

In that sense, Early Warning itself is not changing your scores, but it can start a chain of events that leads to negative items on your actual credit reports.

Errors And Legal Problems

Like credit reports, Early Warning reports can contain mistakes or outdated information, such as incorrect fraud flags or amounts owed. In the past, Early Warning has faced legal action for problems with how it handled consumer information and disclosures, which shows that inaccurate or poorly explained entries have led to people being wrongly denied accounts.​​

What You Can Do

If you think Early Warning has damaged you:

• Request a free copy of your Early Warning consumer report and review it for errors or unknown accounts.​

• Dispute any inaccurate or incomplete information in writing, with copies of supporting documents such as bank letters or statements.​

• If an error has caused repeated denials or serious financial harm and disputes have not fixed it, consider speaking with a consumer‑rights or credit‑reporting attorney about your options

When Do Credit Card Companies Report to Bureaus? Timing Matters for Your Credit Score

Credit card companies play a crucial role in shaping your credit profile by regularly reporting your account activity to the major credit bureaus—Experian, Equifax, and TransUnion. However, many consumers are unclear about exactly when this reporting happens and how it can impact their credit scores. Here’s what you need to know.

When Do Credit Card Companies Report?

• Frequency: Most credit card companies report your account information to the credit bureaus once a month. However, there is no universal day or date—reporting schedules vary by issuer and even by individual card.

• Typical Timing: The most common time for reporting is at the end of your billing cycle, also known as your statement closing date. This is the day your monthly statement is generated, not necessarily your payment due date.

• Variations: Some issuers may report in the middle or at the end of the month, and the reporting may not be on the exact same day each month. In some cases, companies might batch data and report all customer accounts at once, which could add days or weeks between your statement closing and reporting to the bureaus.

• Different Bureaus, Different Dates: Credit card companies don’t always send updates to all three bureaus simultaneously, so updates can appear on each report at slightly different times.

What Information Is Reported?

Credit card companies typically report:

• Your account balance as of the statement closing date

• Credit limit

• Payment history (including any missed or late payments)

• Account status (open, closed, delinquent, etc.)

Why Does the Reporting Date Matter?

• The balance reported is usually the one from your statement closing date, not after your payment due date. This means if you pay your balance in full after the statement is produced, a higher balance may still be reported.

• Since credit utilization (your balance vs. your credit limit) is a major credit score factor, understanding your card’s reporting schedule can help you optimize your reported balance for a better credit score. Many people choose to pay down their balance before the statement closing date to minimize reported utilization.

How Can You Find Your Reporting Date?

• Look for the statement closing date on your monthly statement, which is often a consistent date each month.

• Some credit card companies will tell you the reporting date directly if you call customer service or check your online account features.

• Credit monitoring tools or services may display when your information was last reported to each bureau.

Special Notes

• Late Payments: Negative marks, such as late payments, are generally only reported if payment is at least 30 days overdue.

• Not All Issuers Report Everywhere: Some smaller issuers may not report to all three bureaus, so always check with your specific lender if you’re unsure.

By understanding when and how your credit card activity is reported to the bureaus, you can better manage your balances and maximize your credit score potential. Make it a habit to monitor your statement closing dates and plan payments accordingly for the healthiest credit profile

Actual Payment Information Suppressed

The biggest credit card companies are suppressing actual payment information on credit reports.

The CFPB reported in 2020 that the largest credit card companies are purposely suppressing customers’ actual payment amounts from their credit reports.  Actual payments are the amounts the borrower repays each month, as opposed to the minimum payments or balance. This means that millions of borrowers are missing key information of their repayment behaviors that impacts their credit. This suppression harms the opportunity to receive better financial offers and costs billions of dollars in interest expenses.

As of 2022, the CFPB reported that Americans paid over $120 billion annually in interest and fees on credit cards and since then the average interest rates charged by credit card companies have been quickly increasing.

Last May, the CFPB sent letters to the CEOs of the nation’s largest credit card companies - JPMorgan Chase, Citibank, Bank of America, Capital One, Discover, and American Express - asking if they furnished actual payment information. They asked why they stopped sending complete data and if they had plans to change their practice.

They learned that:

• One large credit card company took the move first, and the others started suppressing their data shortly after.

• The companies didn’t say when they intended to restart reporting actual repayment information.

• Companies suppress data to limit competition. By withholding information it made it harder for competitors to offer more profitable and less riskier customers better rates, products, or services.

Credit card companies are making it difficult for people to shop for credit and to save money. People expect that their credit behaviors - like paying credit card bills in full each month will be reflected in their consumer reports and credit offer they receive.

More Information from the CFPB: CFPB Summary

Buy Now, Pay Later & Credit Score

Buy now pay later options do not generally affect peoples credit and do not yet routinely appear on most credit reports. The credit bureaus; TransUnion, Equifax, and Experian are each working through this relatively new system and how to report on these services in the context of credit worthiness and a borrowers financial obligations. 

This means that a good record of payment on your buy now, pay later accounts will not help build your credit. It also won’t hurt your credit unless your account is sent to collections. This payment option is popular with younger generations, as they are least likely to have built their credit. For now, it is a good way to practice building your credit. 

How Buy Now, Pay Later Works

When you purchase something online, some stores may offer to divide your purchase into smaller installment payments. Most often into four payments, every two weeks. The most used options are Affirm, Afterpay, Klarna, Paypal, and Zip. They partner with retailers who pay them commission. 

Approval is partially based on data that includes address stability, public records and previous history you may have with the lender and banking information. 

Opportunities for Credit Building

The credit bureaus are working hard to incorporate this method into their formulas. Consumers are using these accounts online more frequently than traditional credit cards and loans, especially young consumers. This could prove to be most beneficial to build up credit. 

There are Risks

Since buy now, pay later loans are new and unregulated they are often paid late, most often by consumers of the age group 18-30. BNPY lack the typical protections you would have under a credit card such as dispute resolutions. The easy access to the application causes the consumer to impulsively purchase and buildup debt faster than they normally would. The consumer may also rack up multiple BNPL accounts on multiple sites that could potentially lead to collection accounts. Once sent to collections, it will end up on credit reports. 

The Credit Bureaus

It has been decades since a new type of credit has been in the market. The BNPY system does not fit perfectly within the two categories they have in place now: Installment loans that span months or years and revolving credit like credit cards. 

The bureaus are working together to find a format that fits and are figuring out a common ground.

Current Plans:

• Experian has announced it plans a specialty bureau to hold buy now, pay later data. Information from the specialty bureau will be “promoted” periodically into the consumer’s core credit file.
  

• Equifax plans to add the information to regular credit reports.
  

• TransUnion has said it will partition off the data on core credit reports.

Credit Bureaus Still Failing Consumers

Recently on November 10, 2021, U.S. Senators Senators Brian Schatz (D-HI), Sherrod Brown (D-OH), Ron Wyden (D-OR), Elizabeth Warren (D-MA), Jack Reed (D-RI), Chris Van Hollen (D-MD), and Ben Ray Luján (D-NM), urged the Consumer Financial Protection Bureau (CFPB), to take action to reform the credit reporting industry. 

They want the consumer reporting agencies (CRAs) to improve the accuracy of credit reports, minimize the hassle, and hold the CRAs accountable for errors. 

The smallest of errors could affect millions of people. This could prevent them from getting a job or housing at no fault of their own. These mistakes, consumers may pay more for credit and be denied loans, getting mortgage, or renting an apartment. 

A study that took pace in 2012 found that one in five consumers had an error on their credit reports and five percent had errors that were economically damaging. A followup in 2015 found that nearly 70% of the impacted consumers surveyed three years earlier continued to dispute information. 

If you need information on the disputing process or to seek legal action, contact us for help at anytime. 

What is an ACDV?

The largest search we find on our page concerns ACDV’s. So, what is an ACDV? 

An ACDV is an Automated Credit Dispute Verification form that  is used by the credit reporting agencies to communicate consumer disputes to lenders and collection agencies. 

ACDVs are transmitted to furnishers via an electronic system known as the "E-OSCAR" system, which is an automated system that enables furnishers and credit reporting agencies (CRA’s) to create and respond to consumer credit history disputes.

The ACDV process tracks and manages an ACDV initiated by a credit reporting agency on behalf of a consumer and routes it to the appropriate furnisher.

The furnisher then, returns the ACDV to the initiating CRA with the updated information (if any) relating to the consumer's credit history.

In responding to an ACDV, a furnisher informs the CRA’s if the disputed information is "Verified" or if the disputed information should be "Changed" or if the disputed item of information should be "Deleted".  To do this the furnisher literally checks a box. 

Once checked, this will instruct the CRA that all information about the disputed tradeline is, in fact, accurate and that no changes should be made. If a furnisher chooses to change information, it will check a box called "Change Data As Shown" and then will input changes into the various fields of information that need to be changed. Whenever a furnisher directs a CRA to change information on a consumer’s credit file, that furnisher affirms to the CRA that it has made the same changes to its own systems.  This affirmation is made by the furnisher on the form used to process the dispute. 

Problems persist with Credit Bureaus

Problems persist with Credit Bureaus

Have you experienced issues with credit bureau’s? It seems to be a running theme. The three major credit-reporting bureau’s – Equifax, Experian, and TransUnion, have had the most complaints for four consecutive years. These complaints involve inaccurate information on credit reports. Fighting with these bureaus can be a hassle because the bureaus have more power than the consumer.

            Lawmakers have only begun to pay attention since the enormous data breach from Equifax just two years ago. This led to being able to freeze your reports for no fee but didn’t provide any new ways to protect the consumer. There have been a few reforms in the past few years, such as bureaus being required to inform the other bureaus when a credit file is found to be mixed with another person and that a report can no longer include debts outside of an agreement or contract. For example, The reports are not allowed to include medical records that are 180 days old or less or medical debts that have been paid by an insurer.

            Problems have been persistent, and it seems that reform is not happening fast enough. The disputes are converted into codes that summarize the complaints for the data furnishers, which can be thought of as computers talking to computers. This can be frustrating when you have a dispute that is more complex and you need to talk to a real person.

            During the data breach of 2017, Equifax had a settlement of $700 million, which is comparable to a parking ticket in their eyes. It is just the cost of doing business and easier than changing their business practices to be fair and partial to consumers. It is imperative as a consumer to check your credit report regularly, or you may find yourself unexpectedly rejected for credit when it is most crucial. annualcreditreport.com is a site where you can check your credit report for free annually. As a consumer, it is your job to identify that your accounts are in good standing and have all the correct information. If your personal information is wrong, it could potentially be a mixed file or identity theft. It isn’t uncommon for a credit file to be mixed with someone who has similarities to your identifying information. It is most likely to happen if you have a common first and last name or if you have a family member with a similar or the same name. Credit bureaus may even consider only 7 of the 9 digits of your social security number when matching your information. You have the right to dispute these errors and have them corrected and/or deleted. An error in your file could prevent you from getting credit, renting a home, or getting a job.

            If you come across an error, you should take action from both sides. You should contact the furnisher that provided data to the bureaus and to contact the bureau(s) reporting the error. It may even be best to write a formal letter by mail so that a person and not a computer will receive the information. It also provides you with a paper trail if you were to make a claim.  Being persistent is key, it is not easy to get a furnisher to immediately admit their wrongs. Filing a dispute with the credit bureaus as you communicate with the furnisher will help preserve your right to make a legal claim if the error fails to be corrected. You can find dispute information and mailing addresses through these links: equifax.com/disputes, experian.com/disputes and transunion.com/disputes Contact us today with any questions you may have regarding your credit report.