National Consumer Assistance Plan (NCAP)

  • National - USA
  • Launched : March 2015
  • In Effect: March 2018

TL;DR:

The National Consumer Assistance Plan (NCAP) was an initiative launched by Equifax, Experian, and TransUnion to increase credit reporting accuracy. Rolled out in phases, phase 1 established new standards for civil judgments and tax lien data to appear on a report. Phase 2 created new standards for reporting past due and paid medical debt.

What it is:

The National Consumer Assistance Plan (NCAP) is an initiative launched by the three major credit reporting companies – Equifax, Experian, and TransUnion – to make credit reports more accurate and easier for consumers to understand their credit information and correct any errors. While NCAP was launched in March 2015, the three bureaus implemented the plan over a 3-year period. Policy changes were rolled out in two phases:

Phase 1: Restrictions on Reporting Civil (also known as eviction or housing) Judgements

The following standards (or PII) for a record to appear on a consumer credit report were applied to new and existing public record data on July 1, 2017:

  1. The minimum required consumer identifying information: name, address, social security number, and/or date of birth
  2. The minimum frequency (at least every 90 days) of courthouse visits to obtain newly filed and updated public records is required

With these standards in place, the first phase aimed to reduce the number of false positives, as many civil records lack personal identifiers that are necessary for accurate record matching. As a result, Experian reported about 96% of civil judgment data would not meet the new standards. For tax lien data, they expected as much as 50% of the data would not meet the requirements as well.

96%
Civil Judgment Data Removed
50%
Tax Lien Data Removed

Phase 2: Restrictions on Medical Debt Reporting

On September 15, 2017, the following data reporting changes went into effect:

    1. Medical debt may not be reported until 180 days past due
    2. The bureaus must remove all paid medical debt from the consumer’s credit report
    3. The bureaus will begin requesting data furnishers to submit full social security number and date of birth data. Tradelines and judgments that do not contain these 2 identifiers will not appear on the credit report

What it means:

Combined, phase 1 and 2 of the National Consumer Assistance Plan affected credit reports in these ways:

    • Debts that didn’t come from a contract or agreement to pay no longer appear on credit reports. An example of this is parking tickets.
    • Tax liens that do not contain a full social security number or date of birth on the public record no longer appear on the credit report.
    • Civil judgments that do not contain a full social security number or date of birth on the public record no longer appear on the credit report.
    • Medical debt will not appear on the credit report until 180 days past due.
    • Paid medical debt can be removed/should not appear on the credit report.
    • Data furnishers must adhere to both phases 1 and 2 of NCAP.

Whom it affects:

Consumers

Consumers were and are directly impacted by NCAP. Stricter identification standards means that consumers are able to see less false/inaccurate information on their credit report.

Companies that Rely on Data (End Users)

NCAP's policy changes meant they could better rely on the credit report data as records were healed to a higher standard for matching.

Consumer Reporting Agencies & Data Furnishers

Consumer reporting agencies and data furnishers were impacted internally to adhere to new standards.

Consumers were and are directly impacted by NCAP. With stricter record identification standards, consumers are able to see less false or inaccurate information on their credit reports. Incidents that result in debt – like medical bills or parking tickets – either no longer appear or have a buffer period as to when they can appear on the credit report. Paid medical debt is also removed from credit reports.


For those who used credit reports to analyze financial risk, NCAP’s policy changes meant they could better rely on the credit report data as records were held to a higher standard for matching. As the majority of civil judgments no longer appeared on the credit report, industries that utilized this data (like the rental housing industry) now had to rely on a consumer reporting agency or a transactional data provider rather than the credit report alone.


Consumer reporting agencies and data furnishers were impacted internally to adhere to these new standards.

Resources:

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