09/17/19 - Update on Credit Bureau Reporting

Credit Scores – We changed Servicing Centers through a servicing transfer process.

As a normal part of servicing conversions/transfers – 

  • The transferring (prior) servicer transfers the debt (the “trade line”) and stops credit bureau reporting
  • The transferee (new) servicer reinstates the debt (the trade line balance) and resumes credit bureau reporting within the 60 days following the transfer

The 60 day gap reporting period (driven by federal regulatory requirements) was designed to protect customers due to the forwarding/redirecting of payments between the old and new servicer due to customer confusion associated with the change in servicers.  

The result is that for 60 days it may appear as though the debt (trade line) has been eliminated, and this may cause a temporary slight dip in the credit scores for some of our customers that are trying to refinance.  

Where we see the real impact is to scores that are calculated outside of the true FICO credit scoring process, where servicing transfers are not correctly accounted for – this is most often associated with the calculation of the Vantage Score provided by some entities (such as Credit Karma and other providers).

We are working to shorten this traditional 60 day delay in reporting and are assessing options surrounding a potential special process.  

We believe, worse case, the trade lines will be re-established and credit bureau reporting will resume by October 7, 2019.

Additional details will be communicated as they become available.  See your manager or supervisor if you have any questions.