Credit Reporting Agencies – The Basics

There are three credit reporting agencies that have the authority to gather information about your credit history, and to share this information with other businesses that have a legitimate reason for wanting to see it.

These three agencies are –

• Equifax
• Experian
• Trans Union

You may not like the idea of these agencies having such personal information about you and giving it out to others, but this is necessary in order for you to get credit. Many consumers mistakenly believe that credit reporting agencies are affiliated with the government, but the only thing that the government has to do with these agencies is to control their actions.

The three credit reporting agencies are basically set up as a business to make money while they are also keeping track of the credit records of millions of people.

Credit reporting agencies get their information about your credit history from your creditors, of course. They can also get information from public records and other sources that have proven to provide reliable information.

Some people make the mistake of getting their credit report from just one of these agencies, thinking that all three keep the same information. However, these are three separate agencies, all competing for business. They all work in much the same way, collecting information from the companies who grant credit to individuals or to businesses. But, they do not all get the exact same information. Each of the three gathers from many different businesses, banks and credit card companies, but not necessarily the same one.

Here is how this works.

The three credit reporting agencies go to all of these different companies and try to talk them into joining their individual lists. Some join all three, and some do not. The ones that do can use the records of the credit reporting agency to check the report of anyone who wants to take out credit or receive services that they offer. Potential employers, insurance agents and landlords also view your credit report. Therefore, if you want to get an accurate look at your credit report, you will need to request a copy of it from each of these three agencies.

You are allowed to get one free copy of your credit report from each of the three credit reporting companies once per year. That adds up to 3 per year, enough to let you get a good idea of how your credit looks.

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