Credit Bureaus

Credit bureaus or credit reporting agencies (CRAs) keep a record of your credit history and compile it in a credit report or credit profile. These CRAs sell your credit profile to credit card companies, banks, credit unions, condominium associations, employers, insurance agencies, mortgage companies, and any credit or lending institution that is looking for your credit history information. When you apply for any type of credit or loan that company will request a copy of your credit report. They in turn use this information to approve or deny your application. If your application is approved the information from your credit report will be used to set your terms and interest rate. Your credit record contains information relative to your financial history such as debts, payment history, judgments entered against you, and/or bankruptcy. Credit bureaus do not make decisions on who should or should not be granted credit or a loan they merely provide your financial history to the enquiring companies. The three main credit bureaus are Equifax, TransUnion, and Experian.

Credit bureaus assign a credit rating or credit score to everyone that has established credit. This score is based on your financial and credit history and plays a vital role in your ability to get credit, loans, insurance, and even a place to live. Problems beyond our control can play an integral part in our credit profile. The loss of employment, divorce, medical situations, and even computer errors can cause a negative credit rating or credit scars on our report. Solving these problems may include correcting any errors, explaining financial situations, or writing letters to be included along with your credit report.

Congress passed the Fair Credit Reporting Act (FCRA) to protect consumers and require CRAs to provide accurate and comprehensive financial information for businesses to use when evaluating an application.

The rights granted under the FCRA include:

• Complete access to all the information contained in your credit profile, including the source of the information.
• They must provided the name of anyone or entity that received or inquired about your credit profile within the previous 12 months.
• The CRAs must provide you with a free copy of your credit report if your application is denied because of information supplied by them. You must request the information within 30 days of receiving your denial notification.
• You must be permitted to add a 100-word summary to your credit report explaining any problem, if you are not satisfied with action taken to correct the problem.
• If you have been the victim of identity fraud, you are entitled to a free annual credit report by Federal law.