- There are three main credit bureaus: Equifax, Experian and TransUnion.
- Credit bureaus collect information about your credit history.
- Tracking your credit history and credit score with all three bureaus can help you better understand your finances.
When applying for financing or improving your financial health, you've probably heard of credit bureaus. But what is a credit bureau, and what are the three credit bureaus most popular with creditors?
A credit bureau is a company that helps lenders determine how suitable you are as a candidate for a loan. Credit bureaus can also help you learn more about your own credit history so you can improve your likelihood of getting approved for a loan or recognize identity theft against your name. It’s important to understand the details of credit bureaus and their differences, as well as the role they play in your credit history.
The three credit bureaus: Equifax, Experian and TransUnion
There are three primary consumer credit bureaus (or credit reporting agencies): Equifax, Experian and TransUnion. Although each bureau is a different organization, they all collect consumer credit information that lenders and other parties use to evaluate an individual's credit risk. This information is compiled into what’s known as a credit report. Each bureau maintains its own credit file for any given consumer, so reports may differ among bureaus.
Equifax, Experian and Transunion are all competitors, so each company handles (and receives) credit information differently. Each one may not receive the same payment information from creditors, and this may alter your score among bureaus. There are also less prominent credit bureaus that offer similar services.
What information do credit bureaus collect and display?
Credit bureaus collect information about key indicators of your creditworthiness. These include your credit card payment history, any bankruptcies you’ve experienced, student loan debt and other notes within your credit file as provided by lenders.
- Credit accounts: Credit card and loans in your name. These may be some combination of both open and closed accounts or loans.
- Credit inquiries: Who, when and how often lenders and others have sought information about your credit. This could be due to loan applications or other situations when someone wants to access information about your history with credit.
- Personal information: Bureaus also track your personal information, such as your address, date of birth and marital status, among other particulars.
- Certain public records: Tax liens, civil judgments and bankruptcies are all common public records that credit bureaus track for their files.
Official credit bureau reports don't show credit scores, although each bureau may allow consumers to view them through separate credit monitoring services they offer. Typically, reviewing your own credit score doesn't have any impact since these queries are considered soft credit checks. Credit score checks from others may lower your score, depending on the circumstances.
|Credit Report Privacy|
|The Fair Credit Reporting Act (FCRA) protects your personal data, limiting who can access your information, as well as how. The FCRA limits who can access your information and for what purpose.|
Where do credit bureaus get their data?
Credit bureaus obtain information from many different sources. These include:
- Creditors: Financial institutions, such as credit card issuers, that have lent you money (can be current or prior lenders depending on how long ago the loan closed)
- Debt collectors: Collection agencies in charge of collecting unpaid loans or bills
- Public records: Legal proceedings or judgments against you, including bankruptcy
Not every creditor or lender reports to credit bureaus. Depending on the type of loan and contractual requirements, the lender may not be legally obligated to report loan statuses on a regular basis. To learn more about what your creditor or lender provides, reach out and request details about which loan information they report.
How to check your credit reports from the three major credit bureaus
There are a few different ways for you to check your credit report. Federal law requires bureaus to provide you with one free credit report per year. You can access these reports via annualcreditreport.com and receive one free report per bureau every 12 months. Another way that you can check your credit is through complimentary services offered through your bank or credit card company. These are considered soft inquires that do not lower your credit score.
Experian, Equifax and TransUnion also offer online accounts that may come with their own report availability and pricing.
How to dispute credit report data with a credit bureau
You have the right to dispute data on a credit report. Agencies rely on external information from creditors and may not always receive the most up-to-date details on your credit usage. You may also find fraudulent activity on your credit history due to identity theft. If you do, you can report inaccuracies to one or more bureaus.
Here are the steps to take to dispute an item on your credit report:
- Contact the relevant credit bureau: Reach out to the credit bureau in question via phone, email or regular mail. Each bureau has its own contact information, so be sure to check their site for more details.
- If needed, contact the data furnisher: You may want to reach out to the lender or other source of information on your credit report to better understand the problem.
- Allow time for an investigation and response: Credit bureaus typically have a 30-day time limit to investigate disputes and reach conclusions. There are scenarios in which bureaus have 45 days, however. Providing bureaus with information after your inquiry gives them an additional 15 days to investigate.
- Review results: You'll receive a decision from the credit bureau that details their findings about your dispute. It will tell you whether your complaint has been approved or denied.
- Keep an eye out for the requested updates on your credit report: Watch for changes to your credit report if your complaint was approved. Changes should appear within 30 days, in most cases.
How credit scores and credit reports are related
Your credit report and credit score are connected by the information on your report and your credit history. Each credit bureau uses a proprietary formula that translates your credit history into a numerical score on a particular scale. This scale helps lenders determine your credit risk without having to review the entirety of your credit report.
Credit scores can differ depending on which bureau the score comes from. Some credit monitoring tools provide a FICO score based on TransUnion credit reports, while others might provide FICO scores based on Equifax reports. These figures may vary depending on the information each bureau receives from creditors, which is why your credit score may vary.
It’s vital to understand the role that credit bureaus play in determining your credit score and credit history. These bureaus help inform lenders, creditors and others about your history with credit, which informs whether or not they will approve a loan or credit card application.
Knowing what these bureaus do and the role they play can help you take charge of your credit history and credit score. You can even take proactive steps to help protect your credit, such as a credit freeze, which is another step toward making sure your credit is in the best shape possible.
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