The Credit Bureau

A credit bureau (also known as a credit reporting agency) gathers, maintains, and sells information about consumers' credit history. This information consists of payment habits of loans to lenders such as banks, credit unions, finance companies and retailers, as well as reports from landlords and the IRS. These facts and statistics are stored in a computer database and are sold to prospective lenders in the form of a credit report. Therefore, when you apply for a loan or a credit card, the lender orders and buys a credit report from a credit bureau to scrutinize your credit history. It is upon the basis of this history that a lender judges whether you are credit-worthy or not.

A credit bureau does not make any decisions in the lending process - it merely provides lenders with information that they need to evaluate your application for a loan or a credit card.

Although there are many individual credit bureaus, there are only three that are nationwide and are highly respected in the field. These are:

Equifax

PO Box 105873

Atlanta, GA 30348

800-685-1111

Website:

http://www.equifax.com

Experian

(formerly TRW)

NCAC

PO Box 9595

Allen, TX 75013-9595

 800-583-4080

 Website:

http://www.equifax.com

TransUnion

PO Box 390

Springfield, PA 19064-0390

312-408-1400

 Website:

http://www.transunion.com

It is important to keep in mind that your credit report from one bureau may not be exactly the same a report from another bureau. Most national lending institutions file consumer credit information with all three bureaus; however many smaller banks and other lenders may only report to one bureau.

The down side to this amassing of data on individuals is that often incorrect information is entered and is assumed to be correct until you tell the bureau otherwise. It is the only time that a bureau will validate its data.

Given the wealth of data that these bureaus compile, it is not surprising that they have expanded into other activities, such as:

• Prescreening: Where lenders give the credit bureau a list of criteria for granting credit, and the bureau provides the lender with a list of people who match the lender's criteria. This is why we all receive "Pre-Approved" credit card applications in the mail.
• Consumer Rating: Where the credit bureau provides an assessment of individuals, based upon their past credit history.
• Targeted Marketing Lists: Where credit bureaus provide lists of people to marketers based upon spending habits and income scales.
• Collections:Third party agencies who attempt to collect unpaid debt on behalf of companies.

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The Credit Report