The Credit Bureaus
When you apply for a loan or any type of financing, or even insurance,
or a job you may have to submit to a credit check. When a company or entity
does a credit check they will get their information from one, two, or all
three of the credit bureaus. These three credit bureaus are Experian, Equifax,
and Trans Union. A creditor can choose to check one or all of these
credit bureaus and it is at their discretion. Generally if they find negative
information through one report they will not bother to check with the others.
While
a creditor may only check with one bureau when they run a
credit check on you, they may only report to one or two or all three. Each
creditor has their own process in place, and the result is that your credit
score can vary wildly from one to the next. This difference in reporting
procedures is what causes the differences and why you may have a much better score
with one bureau than you have with the others.
Many people are really
intimidated by the idea of the credit bureaus, but you needn't be.
These bureaus are actually just private companies, like any other, and they work
to sell the information of each consumer to the individuals or companies who
need them. These companies are not to be feared, instead you should just
view them as a maintenance entity of all of your credit information, both good
and bad.
You should also remember that the credit bureaus are a business
and they are in business to make money, selling your credit information.
There are some things that you should know about the bureaus and how your
credit past and present are reported.
First, you should know
that all of the information that appears on your credit report has to be proven,
if it cannot be proven it has to be removed from your credit report. In
addition, you should know that you can call the bureaus at any time and challenge
anything on your credit report and the bureau has 30 days to investigate it
and either provide proof that validates the information or they have to remove
it.
In addition, you should be aware that the credit bureaus get a
lot of their information not only through creditors but also through public records
so your bankruptcies and foreclosures will appear on your credit report, as
well. When you understand where the information comes from and how the
credit bureaus work, it takes a lot of the mystery and intimidation out of the
process and allows you to take control of your credit and your financial future.
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