Credit Bureaus
A credit bureau is an organization that keeps records of individual borrowers. They record a person's credit history and assigns credit ratings based on certain criteria. These credit ratings are then used by lenders as a tool of assessing a person's credibility and risk associated with lending before granting a loan. Even credit card companies use the services of credit bureau reports to know if a person can be trusted with a credit card or not. The bureau of credit may assess a person's financial activity on several criteria to generate a credit report. If according to the credit bureau report and the credit history the person's credit rating is low he may have to face difficulty in getting a loan or borrowing for a mortgage.
Interest rates are not same for every borrower and the interest rate offered to a borrower will also depend on his credit bureau reporting. These interest rates applied to the loans vary by the virtue of risk too. It is advised that a person reviews his credit bureau report once a year minimum to get an idea of where he stands and to verify the information that is displayed on his report. Free credit bureau report can be generated by any person online.
If your bureau of credit report is healthy and favorable you can borrow any amount of money that you wish without any hesitation from the lending institution. However, for those with the credit bureau report that shows them to be a risky party the lenders will hesitate and borrowing will be a major issue. Such people with bad credit bureau reporting are not trusted by lenders and they become prone to get caught in the web of those lenders who will charge high interest rates and unnecessary fees to lend them money.
The fair credit reporting act binds the 3 credit bureau organizations. These three credit bureau national organizations include Equifax, TransUnion, and Experian. These credit bureaus play an instrumental role in the financial world as they generate the three bureau credit score on individual basis which guides banks and other lenders in deciding which borrower to trust. The 3 credit bureau organizations are bound by regulations to erase negative credit history of a person if it is regarding payment defaults. On the other hand errors like bankruptcy are treated with more severity and they take ten years on a credit bureau report before they are written off. If after finding an error in the free credit bureau report generated online a person notices that all three reports have a credit bureau dispute in reporting he can file for mis-represented or true data checking and it takes around thirty days for the credit bureau to investigate and eliminate the error from the person's credit report.
The three bureau credit report generating organizations or credit bureaus include:
EQUIFAX:
Equifax was established in 1899 and it serves as a consumer credit reporting organization. It is based in Atlanta, Georgia. This organization is the oldest of the three credit bureaus. The other two are Experain and TrnsUnion. Equifax has information on over 400 million credit holders or borrowers all around the world. When the company started off as Retail Credit Company it encouraged its employees to dig any dirt of its clients. No personal information was spared. Fair US credit reporting act put a check on the activities of these companies and by doing this they ensured the privacy of people of America and Canada.
Equifax offers products such as credit reports, software, demographic data and analytical reports etc. Its clients are usually businesses which include banks, lending institutions, government agencies, healthcare providers, insurance companies etc. The data provided by Equifax to these businesses helps them determine which products to offer, how to market them and how to price them etc. Every US citizen gets an Equifax's free credit bureau report that they can get fro online. Equifax started monitoring financial data and credit histories in 1999. They also offer solutions to alert people in the event of identity theft and other financial crimes. Equifax's credit bureau Canada has been servicing Canadian nationals since 1899.
EXPERIAN:
Although Experian credit information group operates in thirty countries its North American branch is one of the three credit bureaus that constitute the big three credit agencies in the US. The company is headquartered in Dublin, Ireland. Experian credit bureau offers services in marketing solutions, and credit services etc. The information that Experian credit bureau holds is handled in the manner that the regulation of the particular country requires. In the US the company's operations are regulated by the Fair credit reporting act. Just like Equifax Experian also has to make available online a free credit report to every US citizen. Over the years Experian has expanded its services to many countries by acquiring countries that would provide it with information on local people and databases that will assist Experian in its operations.
TRANSUNION:
TransUnion was established in 1968 and it is currently headquartered in Chicago, Illinois. When the company was initiated it was created to be their holding company by The Union Car Company. It initiated into the credit business by buying credit bureau of Cook County. After this a series of acquisitions followed that resulted in TransUnion becoming one of the three BIG credit bureaus in US. Previously a subsidiary of The Marmon Group TransUnion after 2005 it is a privately held company. It is one of the three credit bureaus in US. TransUnion serves US nationals in all fifty states and people around the world in over twenty four countries. In US alone TransUnion operates around 250 offices. Around the world in its offices TransUnion employs 3,600 people according to an estimate. TransUnion is known to be an innovator and this was one of the companies who initially started automating data transfer for speedy processing of data. Technological advancements have been continuously being brought into the business to increase their efficiency and to facilitate their customers.
Apart from dealing with businesses and providing them with credit information regarding US citizens this company now also deals with individuals and offers them credit profiling and credit report facilities that help them know where they stand as borrowers.