The Credit Bureaus — Who Are They?

Many people believe that the credit bureaus are non-profit organizations formed to help consumers.  Well, I hate to tell you that is simply not the truth.  As a matter of fact, they are very profitable companies.  The credit bureaus are not hired by the creditors; they collect data about YOU from your creditors and resell that information back to you, your creditors and others, such as lenders, banks, insurance companies and employers.  The three major credit bureaus are Equifax, Experian® and TransUnion®.  There’s actually another bureau, Innovis, also known as the fourth bureau.

The Big Three, as we call them, are repositories and not the original creditor.  For this reason, 79% of the information reported is inaccurate according to Public Information Research Group (PIRG) in Washington, D.C.  Some of the errors include:

• 29% – serious errors, false delinquencies, or accounts that did not belong to the consumer.
• 41% – demographic information that was misspelled, outdated or incorrect.
• 20% – missing major credit, loan, mortgage or other information to demonstrate the credit worthiness of the consumer.
• 26% – accounts that were closed by the consumer but incorrectly listed as open (or) “closed by credit grantor”.

Reviewing your credit reported regularly, at least once a year, is an important step to know what’s being said about you.  Although you didn’t ask or authorize the bureaus to share your information, you do have the right to make sure the information is accurate, complete and verifiable.  Remember, if they can’t prove it then they must remove it. 

Let’s get started on your path to good credit management.  Contact us today for a free credit assessment or to register for the next monthly workshop!