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A credit bureau is an organization that tracks the credit histories and related information of individuals. Whenever a person applies for credit, housing, employment, or anything else that their credit history could have an impact on, their potential creditor, landlord, or employer can check the information on file with the credit bureau. If the credit bureau shows less-than-satisfactory information in its report on the person, it may affect the person's chances of receiving the credit, lease, or job. A poor credit report can also result in higher interest rates on a loan or credit card.
There are three major credit reporting agencies: Equifax, Experian, and TransUnion. Although the three companies share information, each credit bureau maintains its own report and credit score on each individual. When someone applies for a line of credit, housing, or employment, the creditor or employer typically looks at the report and score from each credit bureau. For this reason, if an individual is monitoring his or her credit report for fraud or false information, it is a good idea to request a copy of the report from each credit bureau.
A credit bureau gets the information for their reports from the individuals' creditors. For example, if someone has a line of credit with their bank, that bank will report information regularly to the credit bureau -- good or bad. If the individual is always on time with payments, that fact will show on the credit report; however, if the individual has been more than 30 days late on one or more payments, the credit bureau is sure to know about that, as well.
A variety of information gets reported to each credit bureau. The credit bureau will have all of an individual's personal information on file: name, date of birth, social security number, current and previous addresses, and employment history. All of this information is collected by tracking people via creditor reports and social security number.
As already mentioned, the credit bureau also includes the individual's credit history on the report. Account information is listed, including the business handling the account, the date the account was opened, the credit line limit, the current balance, and the payment history. Even if an individual closes an account or the account becomes inactive, the report will still show this information for seven to eleven years. The accounts that each credit bureau includes on a credit report can be anything that is credit related, such as checking and savings accounts, credit cards, loans, and leases.
Each credit bureau also reports any inquiries made into a person's credit report. The report will show the type of inquiry and who made it. If too many inquiries are made within a certain period of time, the person's credit rating can be negatively affected.
A credit bureau also includes public records on an individual's credit report, if they are deemed related to a person's credit worthiness. For example, if a person has declared bankruptcy, he or she will not be considered reliable, and companies may be hesitant to give him or her a line of credit; therefore, bankruptcies are included on credit reports. Even unpaid child support is considered to pertain to an individual's dependability, and will appear on their credit report. This sort of information typically remains on a credit report for seven years.
Although the role of the credit bureau may seem potentially hurtful, particularly to those with poor credit histories, the credit reporting agencies also protect individuals. Any time a credit bureau adds a potentially negative item to a person's credit report, they send the person a letter to notify them, giving the individual the opportunity to verify the accuracy of the information and contest it if necessary. In some states, each credit bureau is required to give a person one free copy of their credit report each year, upon request, allowing people greater control over their credit reports and a better chance of catching identity fraud. Each credit bureau can also place a fraud alert on a person's credit report upon request, aiding victims of identity theft in preventing any further fraudulent activity.
Bhutan-The national credit bureaus consist of Equifax credit bureau, Trans Union credit bureau, and Experian credit bureau.
The banks actually take a look at the lowest of the three scores when they offer you a credit card or a loan.
Usually these three score should be within twenty points. The number of credit bureau checks also appears.
Also, if you see a lot of solicitations for credit card offers in the mail, this could be an indication that companies are checking your credit without you knowing.
It is really best to obtain an annual credit bureau report so that you can check this information.
Sunny27- I agree with you.A free credit bureau report is offered to all Americans at least once a year. This allows you the opportunity to view information that is incorrect and consider disputing credit bureau information listed.
Sometimes this incorrect information could be a result of credit card fraud in which someone fraudulently used your credit card to make purchases which is why the charges appear foreign to you.
It is best to get your free credit bureau report and place a fraud alert if you think someone has stolen your identity.
Great article- I just want to add that it is important to perform a yearly check of one’s credit from one of the listed agencies.
This offers you an opportunity to make sure the information that is reported on the report is correct as well as determining if signs of potential identity theft exist.