Court Explains Inaccurate or Incomplete under the FCRA

The Sixth Circuit Court of Appeals recently explained inaccurate or incomplete information in FCRA claims arising out of a home loan modification situation.  As a threshold matter, consumers must show the information in his or her credit file is inaccurate or incomplete.  In Pittman v. Experian Info. Sols., Inc., No. 17-1677, 2018 U.S. App. LEXIS 23775 (6th Cir. Aug. 23, 2018), the Plaintiff and his home loan servicer may have entered into a loan modification program under HAMP.  Plaintiff made the agreed payments under the loan modification.  However, the servicer reported the Plaintiff’s loan as “past due” and argued that “past due” reporting was not inaccurate under the FCRA since the Plaintiff was “untimely as reported because there was no loan modification agreement and [Plaintiff] was not making the payments under the original contract.”

The Sixth Circuit ruled:

We agree that a threshold showing of inaccuracy or incompleteness is necessary in order to succeed on a claim under § 1681s-2(b). After all, as this Court has described, “Section 1681s-2 works in two phases. Initially, furnishers have a duty to provide the CRAs with accurate information about their consumers. Later, a furnisher may be asked by a CRA to respond to disputes about the consumer information provided.” Boggio, 696 F.3d at 614 (internal citation omitted). And the requirement meets the goals of FCRA by preventing “`furnishers of information’ from spreading inaccurate consumer-credit information.” Id. (emphasis added). To meet this threshold showing, a plaintiff can show that the information provided is false or that it contains a material omission or creates a materially misleading impression. Id. at 617-18.

…

We disagree with the district court that Pittman cannot make his initial showing of inaccurate or incomplete reporting. We think his FCRA claim can proceed for at least two reasons: (1) while there was no written permanent modification document, there may have been an enforceable agreement to modify his loan; and, (2) the Servicers did not report the existence of the TPP.