TransUnion, one of the three major credit bureaus in the United States, has agreed to pay $23 million to settle a class action lawsuit that could put money directly into your pocket. If you disputed a hard inquiry on your TransUnion credit report between December 2016 and January 2025, you may be entitled to compensation ranging from $20 to $160.
This settlement affects more than 485,000 consumers who received what’s known as a “502 Letter” from TransUnion after disputing questionable hard inquiries on their credit reports. The lawsuit claims TransUnion failed to properly investigate these disputes, potentially keeping harmful inquiries on credit reports longer than necessary and unfairly lowering credit scores.
Here’s everything you need to know about claiming your portion of this settlement, including who qualifies, how much money you could receive, and the simple steps to file your claim.
What the TransUnion Lawsuit Was About
The class action lawsuit, originally filed in December 2018, centers on TransUnion’s handling of disputed hard inquiries between 2016 and 2025.
Hard inquiries occur when lenders check your credit for loan or credit card applications, and they can temporarily lower your credit score by about five points.
When consumers challenged questionable hard inquiries on their credit reports, TransUnion allegedly sent standard “502 Letters” instead of properly investigating the disputes.
These letters essentially told consumers to contact the companies that made the inquiries themselves, rather than TransUnion investigating and potentially removing invalid inquiries.
The plaintiffs argued this violated the Fair Credit Reporting Act and unfairly kept damaging inquiries on credit reports.
While TransUnion hasn’t admitted wrongdoing, the company has agreed to change how it handles hard inquiry disputes going forward.
A U.S. District Court in Pennsylvania granted preliminary approval for the settlement in February 2025, with a final hearing scheduled for July 21, 2025.
Understanding Hard Credit Inquiries
Before diving into settlement details, it’s important to understand what hard inquiries are and why they matter to your credit score.
The Difference Between Hard and Soft Inquiries
Credit checks fall into two categories:
- Soft inquiries happen when you check your own credit, get prequalified for a credit card, or a landlord runs a basic background check. These don’t affect your credit score.
- Hard inquiries occur when financial institutions conduct in-depth reviews of your credit history to make lending decisions. These happen when you apply for mortgages, personal loans, credit cards, or auto loans.
How Hard Inquiries Affect Your Credit
According to FICO, a single hard inquiry typically lowers your credit score by fewer than five points. However, the impact can be greater if you have:
- A shorter credit history
- Fewer credit accounts
- Multiple hard inquiries in a short time period
Hard inquiries remain on your credit report for two years but generally stop affecting your credit score after one year. This is why it’s crucial to have invalid or unauthorized inquiries removed promptly.
Who Qualifies for the TransUnion Settlement
You’re eligible for compensation if you meet these specific criteria:
- You disputed a hard inquiry on your TransUnion credit report
- You received a “502 Letter” from TransUnion in response to your dispute
- This occurred between December 5, 2016, and January 31, 2025
The “502 Letter” was TransUnion’s standard response explaining the nature of credit inquiries and suggesting consumers contact the inquiring companies directly. If you received one of these letters, you’re automatically part of the class action settlement.
How Much Money You Can Receive
The settlement offers two tiers of compensation:
Automatic Minimum Payment: $20-$30
All eligible class members will receive at least $20 to $30 without taking any action. This payment will be automatically mailed to the address TransUnion used to send your “502 Letter.”
Enhanced Payment: Up to $160
You can claim a higher payment if you suffered specific financial harm due to TransUnion’s alleged violation. To qualify for enhanced compensation, you must attest that at least one of the following occurred:
- Your TransUnion credit score decreased due to the disputed inquiry
- TransUnion sent your credit report containing the disputed inquiry to a third party
- You were denied credit at least partially due to the disputed inquiry
The final amount depends on how many valid claims are submitted, but could reach as much as $160 per person.
How to File Your Claim
The claiming process depends on which type of payment you’re seeking:
For Automatic Minimum Payment
No action required. TransUnion will automatically mail your $20-$30 payment to the address they have on file from your “502 Letter.”
For Enhanced Payment
If you believe you suffered specific financial harm and want to claim up to $160, you must:
- Complete a claim form on the official settlement website
- Submit your form by June 24, 2025
Alternatively, you can mail your completed form to:
Norman v Trans Union, LLC
c/o Settlement Administrator
PO Box 23489
Jacksonville, FL 32241
If Your Address Has Changed
Even if you only want the minimum payment, you’ll need to file a claim form if your address has changed since TransUnion sent your “502 Letter.” This ensures your payment reaches you at your current address.
Important Deadlines to Remember
Mark these crucial dates on your calendar:
- June 24, 2025: Deadline to file enhanced payment claims
- June 24, 2025: Deadline to object to the settlement or request exclusion
- July 21, 2025: Final court hearing
- Within 90 days after final hearing: Expected payment distribution
When You’ll Receive Your Money
Payments are expected to be distributed within 90 days of the final court hearing on July 21, 2025. However, appeals or injunctions could delay the process.
The exact timeline depends on:
- Final court approval of the settlement
- Any appeals filed by objecting parties
- Processing time for claim verification and payment distribution
Protecting Your Credit Going Forward
While you wait for your settlement payment, take steps to protect your credit and catch future issues early:
Monitor Your Credit Reports Regularly
Check your credit reports from all three bureaus (TransUnion, Equifax, and Experian) at least annually through AnnualCreditReport.com. Look for:
- Unauthorized hard inquiries
- Accounts you didn’t open
- Incorrect personal information
- Outdated negative information
Consider Credit Monitoring Services
Credit monitoring and identity theft protection services can alert you to changes in your credit reports, including new inquiries and opened accounts. Many also provide assistance with disputing errors.
Dispute Errors Promptly
If you find errors on your credit reports, dispute them immediately with the relevant credit bureau. The faster you act, the sooner you can protect your credit score from unfair damage.
Your Next Steps!
If you believe you received a “502 Letter” from TransUnion between December 2016 and January 2025, here’s what to do:
- Gather documentation: Look for your “502 Letter” and any related correspondence with TransUnion
- Assess your damages: Consider whether the disputed inquiry caused specific financial harm
- Decide on your claim type: Choose between the automatic minimum payment or filing for enhanced compensation
- File by the deadline: If claiming enhanced damages, submit your form by June 24, 2025
- Update your address: File a claim form if your address has changed since receiving the “502 Letter”
This settlement represents an important victory for consumer rights and credit reporting accuracy.
Whether you receive the minimum payment or qualify for enhanced compensation, this case highlights the importance of monitoring your credit reports and disputing errors promptly.
Don’t let this opportunity pass by. If you’re eligible, take action before the June 24, 2025 deadline to ensure you receive your fair share of this significant settlement!