OVERVIEW
A credit bureau collects information from different sources about credit and payment information and then provides that information in an organized fashion to lenders. The three primary credit bureaus in the United States are Experian, Equifax, and TransUnion. Credit bureaus create credit reports for lenders that are basically a history of your borrowing and repayment habits. Companies who are trying to determine the creditworthiness of an individual typically request credit reports.

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Who is a Credit Bureau?
A credit bureau collects information from different sources about credit and payment information and then provides that information in an organized fashion to lenders. The three primary credit bureaus in the United States are Experian, Equifax, and TransUnion.

What Information Do Credit Bureaus Collect?
Credit bureaus create credit reports for lenders that are basically a history of your borrowing and repayment habits. On these credit reports, you’ll find your personal information, information about your credit accounts, including your mortgage and your credit cards, any public information about negative events in your history, such as bankruptcies and tax liens, and inquiries that have been made about your credit history, by yourself and others.

Credit bureaus such as Experian, Equifax, and TransUnion take in credit information from companies called data furnishers. These data furnishers are usually lenders and creditors, utilities, debt collection agencies and the courts. Data furnishers report their data to the credit bureaus voluntarily. They might not report all data to all three bureaus, and some lending or credit companies might not report your data at all.

The information collected by the credit bureaus gets collected and stored in their files and databases. This information is then accessed when a credit report or credit assessment is created for an individual. Companies who are trying to determine the creditworthiness of an individual typically request credit reports.

How Do Credit Bureaus Create Credit Scores?
Credit bureaus collect information from data furnishers and they then create a credit score for their customers based on the information they have collected. The credit bureaus create these scores using a mathematical formula that calculates the likelihood that you’ll repay a loan based on comparing your information to others in a similar situation. This credit score helps lenders evaluate the risk associated with lending you money and helps them to assess interest rate on the money they may be willing to lend.

The three credit bureaus, Experian, Equifax, and TransUnion, do not all use the same scoring system and they do not have exactly the same data from the data furnishers. All three credit reports may contain different information. These bureaus are for-profit businesses and are not affiliated with the government, although they are subject to government rules and regulations. These credit bureaus, also known as consumer reporting agencies (CRA’s), are required to provide to consumers a free copy of each of their credit reports every 12 months.