ANSELMO MORENO: Commingled credit reports result in 800 score

Originally published in the Bakersfield Californian

Turning 18 is a milestone for most teenagers, and mine was no exception. I was finally legally able to engage in activities teenagers salivate for, such as getting my own apartment, opening my own bank account, obtaining a credit card, and most importantly, trading in my vehicle for something a bit more desirable.

I went to a car dealership to check out some cars, and was quickly approached by a car salesman.

“Mr. Moreno, we will have to check your credit score to determine the terms of your financing,” I recall being told.

What? I had no idea what he was talking about, so I played along. I gave my personal information and waited anxiously while he went to his manager. I curiously watched as they stared at a computer screen and their eyes glinted with satisfaction.

“Congratulations, you’re approved! You have three paid off car loans with your credit union and your credit score is 800!”

I just turned 18. How could this even be possible? Did somebody steal my identity?

This scenario is an absolutely true story, and a growing problem within the consumer credit and finance industry. The technical explanation is the fact that I am a junior, with the same mailing address and name as my father. Fortunately for me, my father valued his credit profile and paid all his bills on time, and due to the similar identities, our credit profiles were merged together. Clearly, we have different Social Security numbers and dates of birth, so what happened?

The three major credit bureaus, Experian, Transunion and Equifax, sell and maintain personal information. They manage and move millions of files on a daily basis, and they often make mistakes. Father and son credit profiles can become one single profile. If you have a common name, your information can be on someone else’s credit profile with a similar identity, and vice versa.

When a consumer examines a credit report, and identifies something that does not belong there, Identity theft is blamed. However, if you look closely at the trade line, it is paid on time, as agreed. What crook is going to steal something and then pay for it? That’s the first sign of a mixed file. Previous addresses reporting on your credit report in places you have never lived? Another indicator.

While an 18 year old can start off with a synthetic 800 credit score, they can also start off with a 500 credit score if their credit twin just happened to have bad payment habits. It’s a serious, growing trend that we have seen locally. Seven out of 10 consumers who come to my office seeking identity theft advice are experiencing mixed credit file problems.

Fortunately, it is far quicker, and easier, to remedy a mixed credit file than it is to battle real identity theft. A simple correspondence to the credit bureaus requesting that they verify all key personal information including Social Security number, date of birth, and true legal name with the information the creditor has on file generally resolves the situation. There may not be a need for police reports, notarized fraud affidavits, or dealing with fraud investigators.

Check your credit report thoroughly, and often. The only free resource to obtain your credit reports is www.annualcreditreport.com; do not be fooled by imitators.

I asked the salesman if he had realized that I could not possibly have paid off car loans when I was 14. I knew something was not right. So I left, and began my journey to obtain my own 800 credit score.

— Anselmo Moreno is a credit consultant with Innovative Credit Solutions, a credit service organization registered with the California Department of Justice. Contact him at amoreno@icscreditfix.com. These are his opinions, not necessarily those of The Californian.