What is a Credit Bureau?

Credit Bureau Credit bureaus are companies that gather information on individual consumer credit from different sources for various reasons. The three credit bureaus are Experian, Equifax and TransUnion, and they have dealings with a variety of sources known as data furnishers, and they accumulate personal information, financial and other data. Commercial credit reports and scoring also exist, which can be used to assess the probability of a business paying creditors.

From these bureaus you can get your credit history or credit report, which is evidence of a person’s or business’ past borrowing and repaying, including information about late payments and bankruptcy. When a consumer in the U.S. fills out an application for credit from a bank, store or credit card company, the information is forwarded to a credit bureau.

Credit score is a statistical means of guessing the odds of a person paying off the money he or she has borrowed. The credit bureaus that issue these scores have different assessment systems, each based on different factors. Scores range between 350 (extremely high risk) and 850 (extremely low risk). Most countries (including the U.S.) use a scale of 0-9 to rate your personal credit in addition to using credit scores.

It is estimated that 25 percent of credit reports have errors significant enough to bring about a refusal of credit. Improving a credit score by eliminating erroneous information involves communication with the three credit bureaus. However, since credit bureaus are required to erase any information that cannot be confirmed, it’s usually not hard to fix your credit report.