In March 2017, Equifax, Experian and TransUnion (our primary provider) announced they would be making a change to the way they process bankruptcy, lien, and civil judgment information obtained from public records, resulting in significant changes to the information normally contained in a credit report from them.
These changes primarily affected lien and civil judgment data.
- Bankruptcy data: This is information obtained from the federal bankruptcy courts. Bankruptcy was largely unaffected.
- Lien data: This is information obtained from courts and other government agencies showing liens on property, including tax liens. Over 50% of records on liens were lost due to the changes, with TransUnion estimating a 60% loss.
- Civil judgment data: This is information obtained from courts showing judgments entered in civil lawsuits. Almost all civil judgment data will be lost, with TransUnion losing 100% of these records.
Based on these anticipated public record data changes, TransUnion’s internal analysis of their likely impact on its credit reporting database reveals the following:
- Approximately 9% of the population has either a tax lien or a civil judgment reported on their file, which may result in a credit score impact
- The impact across eight TransUnion generic scores tested is expected to be modest. Any score shifts are anticipated to range between 2.5% and 6.4% with most scores increasing.
- There is no loss in the predictive performance of the scores tested since they capture other derogatory-type behavior.
With all this in mind, GIS | HireRight created our own Bankruptcy, Liens and Judgments (BLJ) search, which utilizes a nationwide database that sources from millions of state and federal civil court records as well as bankruptcy filings from all US Bankruptcy District Courts.
*GIS | HireRight’s Blog is provided for informational purposes only and should not be construed as legal advice. Any statutes or laws cited in this article should be read in their entirety. If you or your customers have questions concerning compliance and obligations under United States or International laws or regulations, we suggest that you address these directly with your legal department or outside counsel.