Texas Senate Bill SB696

Texas 2025 - 89th Regular

• Filed: 1/3/25

Caption

Relating to limitations on the information reported by consumer reporting agencies.

Impact

If enacted, this legislation would significantly alter how consumer reporting agencies manage and disclose information related to consumer credit. The restrictions would mean that any negative items, such as bankruptcies older than ten years or judgments older than seven years, would no longer be reported, thereby potentially improving the credit scores of individuals who have resolved past financial issues. This change could have broad implications for consumer credit access and affordability, ultimately aiming to protect the financial integrity of consumers.

Summary

SB696 introduces amendments to the Business & Commerce Code concerning the limitations of information that consumer reporting agencies can report about individuals. The bill specifically seeks to restrict the reporting of certain negative information about consumers, such as bankruptcy cases, judgments, tax liens, and criminal records, to a designated time period. The intention is to provide consumers with a fairer opportunity to maintain a positive credit profile by preventing outdated or irrelevant information from influencing their credit scores and borrowing capabilities.

Contention

Notably, there may be points of contention regarding the balance between consumer protection and the need for transparency in credit reporting. While advocates for consumers celebrate the potential relief this bill would offer to individuals with previously negative credit history, opponents may argue that such limitations could obscure the financial history that lenders rely upon to assess risk. As the bill progresses through the legislative process, discussions may delve into the trade-offs between improving individual credit opportunities and maintaining necessary checks within the credit system.