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Guest Opinion: Celebrating a name change? Protect your financial future

by Eric J. Ellman

Eric J. Ellman. Photo: Courtesy Eric J. Ellman
Eric J. Ellman. Photo: Courtesy Eric J. Ellman  

If you're transitioning into your true gender identity, legally changing your name marks an important milestone in becoming your authentic self. It's a time for celebration and it's also a time for paperwork. Following a legal name change, it might seem obvious to update your identification, bank, and mailing information. It might not be obvious that you should also contact the three nationwide credit bureaus — Equifax, Experian, and TransUnion — to let them know of this change.

Why?

Information like your name is critical to distinguishing your identity when the credit bureaus assemble your credit report. Credit reports are unbiased, factual, legally regulated records of the debts you owe or have owed.

They're the basis for your credit score, which lenders use to assess your creditworthiness and whether to give you a loan. These decisions can help you start a business, get a car, or find a place to live.

Banks and other lenders report consumer information to the three credit bureaus often on a monthly cycle. The date on which this information is reported varies by organization — it could be on the first, middle, or last day of the month. Let's say a transgender or nonbinary consumer is a customer with Bank A, and it reports to the credit bureaus on the first of every month. On the second day of this month, the consumer legally changes their first name. On the third day, that consumer celebrates by purchasing a new car they have been saving up for using their new name for the loan paperwork. Due to the bank and credit bureau's reporting processes, the consumer's credit integrity could be disrupted since the loan was taken out using a different name than what was reported on that month's bank information.

In recent years, Equifax, Experian, and TransUnion have seen an increase in the number of consumers undergoing a name change as part of their gender transition. Recognizing that barriers and challenges still exist for many consumers throughout this process, the three nationwide credit bureaus want to help make this change easier. This month the Washington, D.C., based Consumer Data Industry Association, which represents the three nationwide credit bureaus, launched a consumer education campaign to spread the word about what they can do to avoid this issue and ensure a smooth credit transfer from their deadname to their new legal name.

The most effective action a transgender or nonbinary consumer can take is to directly inform each of the three nationwide credit bureaus of new identifying information, which can be done using their online customer support systems or by calling the companies directly. This small but important step provides the critical link to maintaining the integrity of their credit report during their transition and potentially avoiding any misunderstanding with creditors or lenders. In addition to CDIA's resource page, consumers can also find more information on the process directly through the bureaus:

Equifax

Experian

TransUnion

Empowering the transgender and nonbinary community with this information is at the nexus of CDIA's broader work to advance financial inclusion and equity for all consumers. This year, CDIA is working to continue our industry's momentum on advocating for the utilization of expanded data — or information not currently found in traditional credit reports — in lending decisions.

Expanded data like rental, utility, and cellular payment information is a key tool to increasing opportunity and access to the financial mainstream for consumers in historically underserved communities. In fact, it's estimated that the standardization of expanded data in our financial system could help 63 million unbanked or underbanked American adults obtain access to fair and affordable credit. Long-term, this gives them a better chance to save more money and build intergenerational wealth. For the transgender and nonbinary community, which experiences disproportionately high rates of poverty, this is an especially exciting step toward financial equity.

Making meaningful progress on financial equity requires policymakers, nonprofits, and the private sector to all play an active role. As CDIA has made progress on the legislative side of this issue, the credit bureaus we represent are working individually and collectively toward this goal.

Last year, Equifax began offering the industry's first Spanish-language credit reports online and by mail to help the millions of Spanish-speakers in the U.S. better understand their credit profiles and enhance their financial well-being. Experian recently launched a new, free program, Experian Go, to help people without a credit history establish their financial identity by creating an Experian credit report.

In an effort to advance consumer awareness and education, TransUnion is partnering with Credit Builders Alliance, a national nonprofit network, to help those considered "credit invisible" or "credit disadvantaged" build their financial health.

CDIA — and our industry — is passionate about empowering consumers with information that can help them achieve financial goals and advocating for policies that advance financial inclusion and equity. Taking steps to educate the transgender and nonbinary community on how they can ensure a smooth legal name change is just one part of that equation.

Changing a gender identity and legally changing a name is worth celebrating. We want to be part of that celebration.

Eric J. Ellman, a straight ally, is the senior vice president of public policy and legal affairs at the Consumer Data Industry Association.

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