To address concerns about the vulnerability of foster care children to credit reporting problems, the CFPB has published three action letter templates for child welfare caseworkers to send to credit bureaus if they find errors on the credit reports of children in their care.
In its press release announcing the publication of the letters, the CFPB observed that the youth in foster care are particularly susceptible to credit problems and identity theft because they often lack a permanent address, and their personal information is frequently shared among numerous adults and agency databases. The CFPB also noted that, to be eligible for federal grants, child welfare agencies are required by federal law to ensure that youth in foster care who are 16 and older receive a free copy of any credit reports annually and get assistance in interpreting and resolving any inaccuracies in the reports. According to the CFPB, as a result of this law, the three nationwide credit bureaus (Experian, Equifax, and TransUnion) have each established an online portal that child welfare agencies can use to request credit reports for the youth in their care.
The letter templates are intended to be used in the following situations:
- When a caseworker wants to tell a credit bureau that (1) a credit report exists for a youth in foster care, and (2) the youth is a minor and should not have a credit report in his or her name because the youth does not recognize any of the accounts as his or hers
- When a caseworker wants to tell a credit bureau that (1) there is inaccurate information on a credit report of someone in foster care who is 18 or older related to accounts that were opened when he or she was a minor, and (2) the caseworker wants to dispute the information
- When a caseworker wants to tell a credit bureau that (1) there is inaccurate information on a credit report of someone in foster care who is 18 or older and the error is related to accounts that were opened when he or she was an adult, and (2) the caseworker wants to dispute the information (Due to an apparent glitch, the letter template intended to be used for this purpose appears to be missing from the CFPB’s website and the letter template to which the CFPB provides a link is the second letter above.)
In its press release, the CFPB stated that it was also publishing “tip sheets for parents and foster care caseworkers to help young people to start and maintain good credit.” These tip sheets appear to be new Q&As added to the CFPB’s “Ask CFPB” feature on its website.