WASHINGTON — Two new legal challenges to the dominance of the American credit system by three private corporations — Equifax, Experian and TransUnion — could have far-reaching effects on home buyers and mortgage applicants.

In separate class-action suits, independent credit-reporting companies have accused the three national credit bureaus of antitrust violations and predatory pricing designed to put them out of business. That, in turn, according to the suits, would harm millions of home-mortgage applicants whose credit files contain erroneous, incomplete and outdated information.

The independent reporting companies pioneered and specialize in "rapid rescoring," a technique that allows mortgage applicants' credit files to be corrected within days, rather than a month or more through the national bureaus. Rapid rescoring typically allows home buyers to qualify for better interest rates and terms than they'd receive with erroneous information artificially depressing their credit scores.

In suits filed in federal and state courts in California, the independent agencies complained that Equifax, Experian and TransUnion have tried to eliminate them by charging them higher wholesale prices for credit reports and scores than the bureaus charge the independent agencies' own mortgage lender customers.

The plaintiffs also charged that the three bureaus have drastically raised prices for rapid rescoring while simultaneously prohibiting local rescoring specialists from "directly or indirectly" passing on those costs to the consumers seeking the rescoring services.

In the federal case, filed in U.S. District Court in Santa Ana, Calif., the plaintiffs are 23 independent credit agencies with home offices in 15 states. In the second suit, filed in California Superior Court in Alameda County, the sole plaintiff is the National Credit Reporting Association (NCRA), which represents small, independent credit agencies. The independents are known in the trade as "resellers." They buy raw credit file data and scores from each of the national bureaus and merge the information into credit reports for mortgage applications. They also frequently help home-loan applicants correct inaccuracies in the national bureau files.

The allegations brought by the independent agencies spotlight aspects of the American credit system that most consumers know little about. Although credit-file information vitally affects the interest rates that homeowners pay on their mortgages, auto loans and other credit, the American system of collecting credit data is voluntary and lightly supervised by governments at any level.

The three big national bureaus depend upon millions of credit account grantors, debt collectors, banks and public agencies to make information available to them regularly on the 200 million-plus American consumers they track. The suppliers of information sometimes send consumer account data to all three national bureaus. Sometimes they report to just one or two. Some lenders report to none of the three. No law requires them — or anyone — to supply information to any of the bureaus.

Consumer-group studies in recent years have documented serious problems with the accuracy of the raw data in the private national bureaus' files. A 2002 study of 500,000-plus randomly selected credit files by the Consumer Federation of America and NCRA found that nearly 80 percent were missing at least one revolving credit account in good standing, one-third omitted a mortgage account that had never been paid late and 43 percent of the files had conflicting information about late payments.

Accurate information in the bureau files is critical to a consumer's credit score. Erroneous negative information typically lowers your score. Omission of positive, on-time payment information also lowers scores. The Consumer Federation study found that since the three national bureaus often have widely varying information in their files about millions of consumers, credit scores can vary significantly — 40 to 100 points and more — from one bureau to the next. Score variations that large can cost home buyers tens of thousands of dollars in higher mortgage payments.

With so much riding on credit scores in the increasingly automated home-loan market, mortgage brokers and banks have turned to local, independent credit agencies to get erroneous information purged or corrected quickly. The independent agencies have small, highly trained staffs who know how to contact debt collectors, department stores, health-care billing departments and other creditors to correct bad data in the national bureau files within two to four days on average.

The plaintiffs in the two suits charge that the national bureaus seek to eliminate the local, independent agencies in order to exert full monopoly control over the pricing and availability of credit reports, scoring and rescoring directly or through their own affiliated agencies.

If they succeed, says NCRA Executive Director Terry Clemans, mortgage applicants will lose "a safety net" between them and potentially bad data in the three national bureau files.

Equifax and Experian declined to comment on the suits. TransUnion did not respond to requests for comment.

Kenneth Harney: kharney@winstarmail.com