Home Buddies on the Credit Bureau Secrets We All Should Know
If someone asked you "What exactly is a credit bureau?" would you know? It goes without saying that these credit bureaus have a lot of mystery surrounding them. The purpose of credit bureaus is simply to store payment history, collection and credit records, and specific legal information about consumers and businesses.
The Bureaus sell (yes, sell) your credit data to bankers when a business or consumer applies for credit. Experian, Equifax, and TransUnion are the most recognized United States credit bureaus. Business credit information is the specialty for the less commonly known Dun and Bradstreet. The up-and-coming credit bureau (isn't it exciting...) is Innovis.
You can't expect to be flawless every time if you are keeping track of billions of individual transactions every month. The credit bureaus are simply no different. So it is up to all of us to keep a careful eye on the job they are doing with your credit history.
Most credit report mistakes go uncontested, but most people don't realize that around 80% of credit reports have errors so they don't bother to question it. Think about it, does McDonald's get every order right?
The US Government has recently laid out requirements for the bureaus to maintain accurate records along with obligates them to provide a way for consumers to view their records. It also laid out improvements for responding to consumer complaints.
Credit reporting agencies make their profits by charging a fee to banks, lenders, credit card companies and online agencies for pulling your credit report. They don't actually make any money at all for allocating a staff member to look into complaints or disputes into any errors found in your personal information.
Here is a little known fact about the credit reporting bureaus:
Did you know you could potentially have up to 92 different credit scores? Each independent credit bureau, including Innovis, can issue up to 23 varying scores. The actual report you get depends on who requests your report.
The reason for this discrepancy is because you will have slightly different profiles according to whomever ordered your file information. This means you could end up with a vastly different score from an online service than you would if you pulled your report from a mortgage broker.
For example, if you apply for your report through an online agency you will be required to match up around 18 points of identification to verify who you are. Unfortunately when a mortgage broker requests your report, they only need around 9 elements of identification to match which allows room for more errors and subsequently may reduce your score.
It has been speculated that the credit bureaus provide these different and lower scores because if they are reporting lower scores to lenders, then they feel that they would be less likely to be sued by lenders if the borrower defaults on the loan.
Wow. So are they protecting you? Or just protecting themselves?
The Bureaus sell (yes, sell) your credit data to bankers when a business or consumer applies for credit. Experian, Equifax, and TransUnion are the most recognized United States credit bureaus. Business credit information is the specialty for the less commonly known Dun and Bradstreet. The up-and-coming credit bureau (isn't it exciting...) is Innovis.
You can't expect to be flawless every time if you are keeping track of billions of individual transactions every month. The credit bureaus are simply no different. So it is up to all of us to keep a careful eye on the job they are doing with your credit history.
Most credit report mistakes go uncontested, but most people don't realize that around 80% of credit reports have errors so they don't bother to question it. Think about it, does McDonald's get every order right?
The US Government has recently laid out requirements for the bureaus to maintain accurate records along with obligates them to provide a way for consumers to view their records. It also laid out improvements for responding to consumer complaints.
Credit reporting agencies make their profits by charging a fee to banks, lenders, credit card companies and online agencies for pulling your credit report. They don't actually make any money at all for allocating a staff member to look into complaints or disputes into any errors found in your personal information.
Here is a little known fact about the credit reporting bureaus:
Did you know you could potentially have up to 92 different credit scores? Each independent credit bureau, including Innovis, can issue up to 23 varying scores. The actual report you get depends on who requests your report.
The reason for this discrepancy is because you will have slightly different profiles according to whomever ordered your file information. This means you could end up with a vastly different score from an online service than you would if you pulled your report from a mortgage broker.
For example, if you apply for your report through an online agency you will be required to match up around 18 points of identification to verify who you are. Unfortunately when a mortgage broker requests your report, they only need around 9 elements of identification to match which allows room for more errors and subsequently may reduce your score.
It has been speculated that the credit bureaus provide these different and lower scores because if they are reporting lower scores to lenders, then they feel that they would be less likely to be sued by lenders if the borrower defaults on the loan.
Wow. So are they protecting you? Or just protecting themselves?
About the Author:
Home Buddies gives lectures on real estate investor credit repair in Houston. Starting with a free session for site visitors, Home Buddies develops and implements a customized strategy to improve credit and creates a business development strategy to help real estate investors or homeowners overcome problems to financing real estate and growing a portfolio.
posted by Credit Counseling at
10:35 AM
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