What do the three major credit bureaus do?

Key takeaways

• Credit bureaus collect and maintain records on your credit accounts, balances and the payments you make.

• The three major credit bureaus are Equifax, Experian and TransUnion.

• Each credit bureau operates independently. They may have different credit information for each consumer and assign them different credit scores.

• The information the credit bureaus collect is used to generate credit scores and help lenders make decisions on your creditworthiness.

Credit bureaus collect data on each consumer’s credit activity. The three major credit agencies are Experian, Equifax and TransUnion. “No one credit bureau is more important than another,” says John Ulzheimer, consumer credit expert, formerly of FICO, Equifax and Credit.com. “There’s no guarantee that any particular credit report is going to always yield the highest score.”

That’s because lenders aren’t required to report to all three credit bureaus, so your credit reports might contain slightly different information. As a result, your credit score may vary based on which credit bureau’s data and which credit scoring model is being used.

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What are the three major credit bureaus?

Equifax, Experian and TransUnion, the three main consumer credit bureaus, collect credit information and provide credit reports.

Equifax

Equifax has been in business since 1899. In addition to compiling and assessing consumer credit information, Equifax provides resources for consumers who want to build credit or put a credit freeze in place. The company also offers credit and identity monitoring services for a fee.

Experian

As one of the biggest credit bureaus worldwide, Experian supports clients in over 100 different countries. The company maintains credit information on more than 245 million U.S. consumers and 99.9 percent of U.S. businesses. It also offers free credit monitoring services along with additional tools and resources for a fee.

TransUnion

TransUnion has a large global presence, reportedly overseeing the credit information of hundreds of millions of people in 30 countries. Like the other major credit bureaus, TransUnion offers free credit tools and resources along with paid credit monitoring and identity theft protection.

Main differences among the three credit bureaus

In general, all three credit bureaus collect similar information and offer the same services, tools and resources, but there are some differences in what information is available and how much their services cost.

How do credit bureaus work?

Credit bureaus are private companies that compile and collect consumer data to maintain credit reports. They also sell services, such as identity theft protection and credit monitoring. These agencies get your information from various types of creditors, which include credit unions, banks and other lenders. They can also gain access to additional information from public records.

According to Margaret Poe, head of consumer credit education at TransUnion, the number of agencies reported to is up to the lender.

When your credit score is calculated, it’s based off of one of your three credit reports. Since the information included can vary, this can cause your credit scores from each bureau to be different. Poe adds that each credit bureau also uses different credit scoring models, so “it’s normal to see some variation in the credit scores you’re given.”

Keep in mind: Credit bureaus don’t keep track of non-traditional credit factors, such as your rent and utility payments, unless you either self-report them or your landlord or provider reports a delinquency.

Learn more: How to report your rent payments to credit bureaus

What information do credit bureaus collect?

Credit bureaus collect and monitor an array of information, including:

• Personal information: Your credit reports include your name, nicknames or aliases, birth date, Social Security number, current and past addresses and phone numbers.

• Credit accounts: Credit bureaus also collect information about your credit accounts, including any previous or current mortgage accounts, credit card accounts, auto loans and other accounts lenders have reported.

• Payment history: Lenders who report your accounts to the credit bureaus also share your payment history.

• Public records: The three major credit bureaus also have access to public records, such as bankruptcies and foreclosures.

• Debt collection activity: If your debt has been sent to a debt collector, a lender may report it to the credit bureaus.

• Credit inquiries: Your credit report will also include hard and soft credit inquiries.

Credit bureaus do not keep track of the following:

• Race

• Age

• Marital status

• Religious or political affiliation

• Income

• Gender

How do credit bureaus get your information?

Credit bureaus gather information from a variety of sources to compile your credit report:

• Financial institutions: Credit card issuers, banks, mortgage lenders and other financial institutions regularly report information about your credit accounts, including account balances, payment history, credit limits and the status of your accounts.

• Prospective lenders and creditors: Anytime you apply for credit, lenders and creditors may perform a hard inquiry on your credit report.

• Collection agencies: If you have accounts sent to collections, collection agencies will report this information to the credit bureaus.

• Public records: Credit bureaus collect information about bankruptcies from public records. Before 2017, the credit bureaus included information about civil judgments and liens, or legal claims on your property, on your credit reports.

• Utility companies and landlords: Utility companies and landlords may report your payment history to the credit bureaus, especially when there are delinquencies or collections.

• Self-reported data: Some credit bureaus, like Experian, allow you to add additional information to your credit reports, such as rental payment history, through services like Experian Boost.

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What is the advantage of having three credit bureaus?

According to Ulzheimer, the advantage of having three credit bureaus for the consumer is coverage:

Reporting errors or evidence of fraud can occur on any of your credit reports, says Ulzheimer. As a result, it’s critical to monitor all three reports to check for the following things:

• Errors that can harm your score

• Signs of identity theft, such as unrecognized transactions

• Confirm your reports are accurate before applying for a loan

Contacting the three credit bureaus

It’s important to dispute errors on your credit report as soon as you discover them. You can file disputes online or by sending a letter directly to the credit bureaus. In lieu of filing disputes yourself, you can hire a credit repair company to address the mistakes on your credit reports.

Below is the contact information for disputing errors on your credit reports with each of the credit bureaus.

Frequently asked questions

• How do you check your credit report?

  You can get a free copy of your credit report from each of the three major credit bureaus through AnnualCreditReport.com. Simply visit the site, fill out the required information and select which bureau’s report you’d like to view. You can also request your reports by phone or mail if you prefer.

  You can check your reports for free once a week. Regularly reviewing your credit reports helps you stay informed about your credit history and spot any errors or signs of identity theft.

• How do you check your credit score?

  Many banks, credit card issuers and financial institutions offer free access to your credit score as a perk for being a customer. Several online services also provide free credit scores and monitoring tools.

  If you can’t access your score for free, you may consider purchasing it directly from the credit bureaus or through FICO’s website.

• How does my credit information stay private?

  The Fair Credit Reporting Act (FCRA) is a federal law that ensures the accuracy, privacy and fairness of consumer credit information handled by credit bureaus.

  While credit bureaus can gather information on your credit activities without your explicit consent, businesses that want access to this information via a credit check must have a legitimate reason as defined by the law.

• Does your credit report include a credit score?

  No. While your credit report provides detailed information about your credit history, it does not automatically include your credit score. Each of the three credit bureaus gives you the option of obtaining a credit score (either paid or free) when you pull a credit report.