Credit reporting agencies play a huge role in the financial lives of consumers. The financial information they gather and prepare in their reports helps determine consumers’ creditworthiness. A person’s ability to obtain loans and to receive favorable terms for the loans they do obtain depends in large measure on the reports that credit reporting agencies provide lenders.
Credit reports also impact a consumer’s ability to obtain credit cards, mortgages, auto loans, apartment rentals, check cashing privileges at retailers, and even employment.Credit reporting agencies are also invaluable to lenders, credit card companies, retailers, banks, landlords, and employers from whom consumers seek credit. Lenders rely on credit reporting agencies to reduce their risk by providing insight into the creditworthiness of potential customers and potential borrowers.
Because credit reporting agencies have such a prominent place at the intersection of consumer borrowers and corporate lenders, problems inevitably arise. We’ve compiled the following list of credit reporting agencies to provide some understanding of who is monitoring you and to whom they are sending the results of their monitoring. So when a problem does arise, you know the entity you are dealing with.
Major Global Credit Reporting Agencies
There are three credit reporting agencies in the United States that people generally consider the most important. They are:
- Experian. As one of the largest credit reporting agencies, Experian operates in nearly 40 countries and collects and reports on the financial history of over one billion consumers worldwide. In the United States, Experian maintains the data and financial history of more than 300 million Americans.
- Equifax. In addition to its significant role as one of the three big credit reporting agencies, Equifax maintains a robust data, analytics, and technology company. Therefore, it collects demographic data as well as financial history and financial data. It operates or has investments in 24 countries, and is known for its comprehensive credit and demographic data.
- TransUnion. TransUnion provides credit reports and other specialized financial management services in more than 30 countries. It collects, aggregates, and reports on the information of over one billion consumers.
All three credit reporting agencies collect data from thousands of sources. Lenders use the reports and the data they purchase from all three of the above companies to assess crest risk. Good reports from the above three credit reporting agencies are key to a consumer securing loans and favorable loan terms. Additionally, despite the large role these agencies play in the financial health of consumers, the credit reports they provide lenders sometimes need to be corrected. When errors or inaccuracies appear in their reports, the effect on consumers can be devastating. You can receive a free copy of your credit report every week from the above three agencies. Details on how to request your report are available on each of their websites. If you have identified an error in your credit report or if you have already suffered the consequences of an error in your credit report, contact an attorney. Consumer protection attorneys dealing with credit reporting agencies daily are ready to talk to you.
Other Credit Reporting Agencies
- Innovis. Innovis is often called the fourth national credit reporting agency in the United States. While it offers similar services as the three major bureaus, it has carved out a niche selling mailing lists to companies who want to contact a certain demographic with a certain creditworthiness in a certain state or zip code.
- CoreLogic Credco. This company specializes in assembling data from a consumer’s mortgage and rental payments. It provides reports to landlords, apartment complex managers, mortgage companies, and any company in the real estate industry to determine a potential tenant’s habits when it comes to housing.
- Dun & Bradstreet. This company specializes in collecting financial information on businesses, preparing a credit report on that business, and then selling the report to lenders. If you own a small business and apply for a loan, your potential lenders would buy a credit report of your business prepared by Dun & Bradstreet.
- Fair Isaac Corporation. This company, from which the acronym FICO originated, pioneered and developed the use of scoring to determine a person’s creditworthiness. This company prepares your FICO score and provides it to credit reporting agencies. FICO scores generally fall between 300 and 850. The higher your FICO score, the more creditworthy.
- The Retail Equation. This company monitors a consumer’s merchandise return habits. When a person tries to return something at a store that uses The Retail Equation, this company will alert the store if anything about the customer or the item they are trying to return warrants rejection of the return.
- Early Warning Services, ChexSystems, and Certegy. These three companies provide consumer data and financial information to banks and check acceptance companies. Before cashing a check, the banks and check acceptance companies will look at a report to determine if the check cashier’s check cashing habits suggest fraud. These companies provide that report.
- Clarity Services and Teletrack. These companies specialize in collecting and producing credit reports from non-traditional credit data like utility bills, cell phone bills, installment loans, prepaid card issuers, and other small-dollar lenders. Lenders typically use Clarity Services to determine the creditworthiness of individuals with no credit history or insufficient credit history.
These credit reporting agencies indicate that in special circ*mstances, lenders evaluate a consumer’s creditworthiness and financial history with more than just traditional credit scores. You should know these agencies exist, know that they are subject to the same laws as the three major credit reporting agencies, and know that mistakes in their reports can happen and be just as damaging as mistakes in the three major credit reporting companies’ reports.
Consumers should understand the companies that determine such a large measure of their financial health. You should regularly review your credit reports to see if there are any errors.
