US banks agree to correct credit reports

New York

TWO of America's biggest banks will finally put to rest the zombies of consumer debt - bills that are still alive on credit reports although legally eliminated in bankruptcy - potentially providing relief to more than one million Americans.

Bank of America and JPMorgan Chase have agreed to update borrowers' credit reports within the next three months to reflect that the debts were extinguished.

The move is a victory for borrowers whose credit reports have been marred as a result of the reported debts, imperilling their job prospects and spoiling their chances of getting new loans.

The change by the banks emerged this week in US Bankruptcy Court in White Plains, New York, where the two banks - along with Citigroup and Synchrony Financial, formerly GE Capital Retail Finance - face lawsuits accusing them of deliberately …