EQUIFAX DATA BREACH COULD LEAD TO YEARS OF GRIEF FOR HOME BUYERS

Source: Washington Post

The catastrophic theft of 143 million consumers’ personal data from national credit bureau Equifax could cause financial grief for years for home buyers and mortgage applicants. The odds are that some of your sensitive information was stolen — possibly your address, Social Security number, driver’s license and credit card numbers — and could now be up for grabs to the highest bidders on a Dark Web site.

Making sense of the story:
• Equifax and the other two national bureaus, Experian and TransUnion, keep files on approximately 220 million individuals, so roughly two-thirds of consumers are potentially at risk from the breach. Ironically, the people who are called “credit invisibles” — the millions of Americans with little or no information in the bureaus’ files — may be the least affected by Equifax’s security lapse.

• Home buyers and mortgage applicants, on the other hand, tend to have significant information on file at the bureaus and could run into complications soon or down the road.

• If your personal information was hacked but you don’t do anything to detect fraudulent activity on one or more of your credit accounts, you’ll have problems. For example, you sign a contract to buy a house, and you apply for a mortgage. The lender pulls your credit and confronts you with shocking news: Your FICO credit score is too low for you to qualify for the loan because you’ve been running up too much debt on one or more accounts.

• Additionally, say your lender already has approved you for a mortgage or a home-equity loan. Before the scheduled closing, the loan officer does what has become standard practice in the mortgage industry in recent years — runs another credit check to make sure no new debts have been added since your application. But in the meantime, identity-theft criminals have created a new account or run up charges on one or more of your credit cards, knocking your debt-to- income ratio out of sight.

• Consumers are advised to “lock down your files” with fraud alerts or credit-file freezes. The latter can prevent criminals from creating accounts in your name by denying access to your credit reports. The former signals potential creditors to take extra steps to verify identity before issuing new credit in your name.

Full story
https://www.washingtonpost.com/realestate/theft-of-data-could-lead-to-years-of-grief-for- home-buyers-and-mortgage-applicants/2017/09/12/ed0f66fc-971a-11e7-82e4- f1076f6d6152_story.html?utm_term=.9a34b974c756