WASHINGTON, D.C. – Today, Congressman Blaine Luetkemeyer (MO-03) spoke on the House floor regarding legislation from Democrats that would put the federal government in charge of establishing credit scores for consumers, subsequentially weakening one of the most objective, accurate ways to determine a borrower’s credit worthiness.

“Thank you, Mr. Speaker.

“The bill we are considering today is made up of 6 extremely partisan pieces of legislation. This package will not receive substantial bipartisan support and is dead on arrival in the Senate.

“Unfortunately, instead of working in a bipartisan manner to improve credit reporting for consumers, the majority has chosen to advance legislation that simply attacks an industry to the consumers’ detriment.

“I think the Ranking Member made a number of points a while ago with regards to the willingness of the minority to advance a lot of different solutions to some of the concerns that we all have, yet they were not heard.

“Each piece of legislation in this package has one of two goals. The first goal is to expand the authority of the CFPB over credit modeling, and the second is to eliminate as much information from a credit report as possible. Both of which will increase the cost of credit and make it even more difficult for low-and moderate-income families to receive a loan.

“If the financial institution is unable to analyze a risk, it has to increase the cost to be able to cover the additional risk. It’s just that simple.

“In this Congress, we have had witness after witness come before our Committee and praise the use of alternative credit modeling. Using alternative data can increase access to credit, particularly for low income consumers and the underbanked.

“Instead of supporting efforts to modernize and increase credit access, the majority seems inclined to stifle innovation by requiring the CFPB -- an unaccountable government agency -- to determine what factors can be used in credit scoring. Putting the government in charge of establishing credit scores for consumers is a dangerous notion that strikes at the heart of economic freedom in this country.

“In eliminating the information that appears on a credit report, my colleagues on the other side of the aisle are weakening one of the most objective, accurate ways to determine credit worthiness of borrowers.

“If lenders can no longer rely on a credit report to reflect the actual risk of a borrower, the lender will be forced to increase their rates to ensure they are pricing in the additional risk they are taking.

“This increased cost of credit will directly affect the individuals who are on the margins, notably low-to moderate-income borrowers.

“While I think the majority may have good intentions with this legislation, government control of credit modeling and decreased access to credit for low-income families sounds like a disastrous recipe for our economy.

“That is why I am opposing this legislation and urge my colleagues to do so as well. With that I yield back.”

Read the full bill text HERE.