What is a Credit Bureau?Your credit report is compiled by a credit bureau--a private, for profit company that gathers information about your credit history and sells it to businesses that are allowed to see information concerning your credit: banks, credit unions, credit card companies, mortgage lenders, insurance companies, department stores, landlords, and employers. Why are there so many mistakes on credit reports? Maintaining accuracy makes their job more difficult and credit bureaus don't profit from those with a good credit history. For example, an individual with poor credit has an average of 70% more inquiries from various lenders to their credit file - and the credit bureau receives $3-5 for every one of these inquiries. The conclusion is that the credit bureaus benefit from people who have bad credit. The results of inaccurate and unfair reporting benefits them, to the disadvantage of consumers without a perfect credit history. The credit bureaus get most of their data from creditors, but they also search court records for lawsuits, judgments, and bankruptcy filings. They also search county records to obtain information about recorded liens (legal claims). Noncredit data such as previous names, past and present addresses, Social Security numbers, employment history, and even divorce and marriages are included on your credit report. Credit information includes the names of your creditors, type and number for each account, the date each account was opened, your payment history, your credit limit or the original amount of the loan, and the current balance and status of each account. Credit reports show if an account has been turned over to collection agencies or is in dispute. Credit bureaus add any new data to existing information on file to create a month-by-month credit history of individual consumers. Businesses can then use the information from individual credit report companies to decide your credit worthiness. The federal Fair Credit Reporting Act (FCRA) , amended by the Fair and Accurate Credit Transaction Act (FACTA) , allows consumers to obtain a free copy of their credit report once annually from the three major credit bureaus. The three major credit bureaus are:
The reason is that the credit bureaus have 45 days to investigate disputes from reports obtained at www.annualcreditreport.com, but only have 30 days to investigate when you order your report directly from them. This increases the chance that negative marks will be deleted through the dispute process. Also, the World Privacy Forum recommends that consumers may be better protected by requesting their credit reports by phone or mail rather than online. See www.worldprivacyforum.org/calldontclick.html for more information. You are also entitled to one free copy of your credit report each year under the following circumstances: denial of credit because of information in your credit report and you request a copy within 60 days of denial of credit, you believe your credit file contains errors due to identity theft or fraud, denial of employment (or another adverse employment decision has been made) based in whole or in part on information in the report, or your report has been revised based on an investigation requested by you, unemployment, you receive public assistance. If you do not qualify for a free report (for example, you have already ordered your free report for the year), there will be a charge. This amount varies from state to state but is usually around $8.00 or $9.00 per report. It is a good idea to subscribe to a credit monitoring service to keep a constant eye on your credit reports. When requesting your credit report, you'll need to provide the following information: -your full name (including suffixes such as Jr., Sr., III, etc.) -your birth date -your Social Security number -your current address and addresses for the previous five years -our Spouse's name (if applicable) -your telephone number When dealing with the credit bureaus, understand that they are in the business of collecting and selling information. It is in your best interest to avoid providing a credit bureau with any information that is not legally necessary. Legally, you simply need to provide your name, social security number and legal address to obtain your credit report. The bureaus may request more information. For example, if the address they have on file is different from your current one, they may request a copy of your driver's license or a current utility bill to prove your address. The reason you should be cautious when dealing with credit bureaus is that they may own many collection agencies, and if you have a credit problem you want to provide them with as little information as possible with which to harass you with.
Click here for an example of a letter you could send to the credit reporting agencies to request a copy of your credit report. Opt Out: Remove Your Personal Information From Lists An important step in credit-repair is to "Opt Out" from receiving offers of credit due to information from your credit reports. Opting out also hides your personal contact information from collection agencies. If you are delinquent on credit accounts, it is best to opt out so your credit report information is not available to collection agencies and potential creditors. If you opt out, credit bureaus cannot sell your personal information, only someone with a permissible purpose can get your information. The following is a quote found on the TransUnion website for selling marketing lists to creditors: TransUnion Customer Management In a diverse marketplace, existing customers are one of your best sources for future growth. TransUnion offers a full suite of solutions to help you increase the value of your existing relationships by identifying which customers are suitable for additional products. Our solutions enable you to monitor your current portfolios to identify these extra opportunities in a timely manner, while reducing risk at the same time. And our fraud prevention services help you to protect your customers while increasing their potential for revenue growth. Here is another: TransUnion Collections Management TransUnion can help make your collections processes simple, effective and successful. Our advanced solutions give you access to current information for virtually every market-active consumer in the U.S., so you can locate missing debtors more cost efficiently. We help you better allocate work flow and determine appropriate staffing levels through advanced analytics that assess a debtor's ability and likelihood of repaying. If, on the other hand, you welcome plenty of unsolicited pre-approved credit offers, it is to your advantage to be "opted in." You should determine where in your credit-repair journey you are in deciding to opt in or out of these marketing lists. It's likely each of the three top credit bureaus--Equifax, TransUnion, and Experian-- all have slightly different information about you. Creditors don't have to report to all three credit bureaus, so they typically report to the one to which they subscribe. Why order your credit report?
FREE credit report and score with a FREE 7-day Experian Triple Advantage Monitoring trial. Check & dispute possible inaccuracies. Will not lower your score. Detect critical changes and potential identity fraud. Monitor your credit report to help catch ID fraud early. Order yours now!
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