Equifax, one of the largest credit reporting companies in the United States, has agreed to a $2.2 million settlement in a class-action lawsuit related to an alleged error in the reporting of unpaid debt. The settlement was reached after a Georgia woman discovered that the company had noted a $305 collection account on her credit report more than once.

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The lawsuit claims that Equifax’s error resulted in a severe drop in the plaintiff’s credit scores, which led to the denial of a mortgage loan application. The company has denied any wrongdoing but has agreed to the settlement, which includes cash payments and six months of free credit monitoring service for affected consumers.

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What the Equifax Settlement Is About

The lawsuit against Equifax was filed in June 2022, after the plaintiff discovered that the company had reported a $305 collection account on her credit report multiple times. The plaintiff claimed that this error had resulted in a severe drop in her credit scores, which led to the denial of a mortgage loan application.

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The lawsuit alleges that Equifax’s error was a result of a violation of the federal Fair Credit Reporting Act (FCRA), which requires credit reporting companies to ensure the accuracy of the information they report. The FCRA also requires credit reporting companies to provide consumers with a copy of their credit report and to allow them to dispute any errors they find.

According to the settlement agreement, Equifax has agreed to avoid reporting the same collection account more than once on the same Equifax consumer report for a period of six months. The company has also agreed to provide affected consumers with six months of free credit monitoring service.

The settlement includes cash payments to affected consumers, with each class member estimated to receive up to $600. The total amount of the settlement is $2.2 million, which is expected to be distributed among approximately 37,000 affected consumers.

Who Qualifies for the Settlement Payout?

Eligible consumers are those who had a duplicate collection account noted in their credit report at the same time a credit report was requested. The alleged erroneous reporting of collection accounts occurred in August and September 2022.

Affected consumers will receive notification by mail or email from Equifax, and they will need to provide their ID and PIN to submit a claim. The deadline to submit a claim is September 1, 2026, and claims can be submitted online or by mail.

Consumers who are unsure whether they are eligible for the settlement can visit the official settlement website to check their eligibility. The website also provides information on how to submit a claim and what to do if a claim is denied.

In addition to the Equifax settlement, there are several other class-action lawsuits related to data breaches and credit reporting errors that consumers may be eligible for. These lawsuits include a $725 million settlement related to Facebook’s handling of user data and a $117 million settlement related to a data breach at Comcast.

How to Monitor Your Credit Report for Errors

Monitoring your credit report regularly can help you catch errors, such as duplicated collection accounts, before they cause any damage to your credit score. You can check your credit report for free at annualcreditreport.com, which allows access to all three major credit reporting companies.

It’s also a good idea to check your credit report regularly to ensure that it is accurate and up-to-date. You can do this by requesting a copy of your credit report from each of the three major credit reporting companies and reviewing it for any errors or inaccuracies.

By monitoring your credit report regularly and taking steps to correct any errors, you can help protect your credit score and ensure that you are not affected by any errors or inaccuracies in your credit report.