A credit bureau is an agency that gathers data about your finances, business, income, banking status, debts, etc., to find out your financial credibility. A credit bureau may collect this data from the taxes you pay, the property you purchase the bank whose services you use, and so on. Credit bureaus have quite a few roles to play in the finances and investments sector.
A credit bureau calculates your creditworthiness and builds your credit reports based on how well you handle your credit. Whether you shut down your business or have hospital bills way beyond your budget, a credit bureau can examine every aspect of your personal and professional finances. Credit bureaus also keep a keen eye on how well you handle or struggle with your credit challenges.
The United States has several big and small credit bureau institutions. Here are the three major credit bureaus – Experian®, Equifax® and TransUnion®. They have similar purposes, but their strategies differ based on what lenders require from them.
The credit bureaus offer FICO®Scores that range from 300, the lowest credit score, to 850, the highest credit score.
An Experian credit report breaks down your data into the following sections:
- Personal information, both present and past, that’s relevant to you or your creditor
- Your account details, including monthly balance history, debts, mortgages, transactions, etc.
- Your employment status
- Any other inquiries that creditors and lenders ask for when providing debts.
- There are a couple of factors that determine your Experian ranking. These include:
- The outstanding debt on an account
- How long the account has been active
- Number of late payments
- Type and purpose of the account.
An Equifax report is made up of the following details:
- Installments and dues
- Data regarding revolving accounts
- Personal information, including past details
- Other accounts, including those in other credit bureaus, etc.
- Collection details, including information of accounts that have been disabled due to lack of payment
- Inquiries from potential creditors
- Bankruptcy records
- Consumer statements that may be relevant to the report
Equifax takes into consideration the following data:
- Type and purpose of the account
- Credit utilization, including used and available balance details
- Credit history length
- Payment history
When getting your TransUnion® report, you can find the following details:
- Personally identifiable information and professional information, such as Social Security details, phone number, past addresses, etc.
- Employment status
- Credit information, including accounts, history, payments, dues, balance, etc.
- Credit report inquiries in the last two years
- Public records, such as bankruptcies.
What Type of Data Do Credit Bureaus Include in Your Credit Reports?
Credit reports can vary with each bureau. A credit bureau’s report includes financial, personal, professional and legal details that may impact payment of the loan they might extend to you. A credit report basically analyzes the chances of failure and success with the loan you are applying for from a creditor.