Which Organizations Compile and Report Credit Data?

Credit reporting provides an overview of an entity’s financial behavior. Creditors, lenders, and other businesses rely on this information to make informed decisions regarding credit extensions, insurance, and employment. This system facilitates economic transactions by providing transparency and a standardized method for evaluating financial risk.

Major Consumer Credit Reporting Agencies

In the United States, three primary organizations compile credit data on individuals: Experian, Equifax, and TransUnion. These entities, often called the “Big Three” credit bureaus, collect financial data from various sources, including lenders, creditors, and public records, to generate credit reports and scores.

Experian has grown into a global leader in credit reporting, maintaining information on billions of consumers and businesses. TransUnion is one of the largest credit bureaus in the U.S. Equifax is one of the oldest U.S.-based credit bureaus and plays a comparable role in compiling consumer credit histories.

These credit bureaus receive regular updates from data furnishers like banks, credit card issuers, and other lenders. They use this information to create credit reports, which are sold to creditors and authorized parties. While they do not make lending decisions or determine credit scores, their data forms the basis for these evaluations.

Major Business Credit Reporting Agencies

Businesses have credit profiles compiled by specialized reporting agencies. The main organizations gathering business credit data include Dun & Bradstreet, Experian Business, and Equifax Business. These agencies collect financial and operational information to produce business credit reports and scores.

Dun & Bradstreet focuses exclusively on business credit, providing analytics and company data. They gather information from suppliers, creditors, public records, and interviews with company principals. This data contributes to various D&B scores, including the PAYDEX score, which indicates a company’s payment history with its suppliers.

Experian Business and Equifax Business play significant roles in the commercial credit landscape. They collect data on how businesses interact with vendors and suppliers, including payment trends, legal filings like liens and bankruptcies, and company size. Lenders, suppliers, and other businesses use these reports to assess a company’s financial health, reliability, and eligibility for credit, insurance, or contracts.

Data Principles and Credit Reporting

Credit reporting agencies collect and organize data for credit reports. This information provides a detailed financial history and is used to calculate credit scores. Core data points include:

• Personal identifying information
• Credit account details
• Payment history
• Public records

Personal information includes:

• An individual’s name
• Current and past addresses
• Date of birth
• Social Security number

These are used for identification. Account information details the types of credit held, such as revolving accounts (credit cards) and installment loans (mortgages, auto loans). This includes credit limits, current balances, and the dates accounts were opened or closed. Payment history records whether payments have been made on time.

Other data points include amounts owed across all accounts and the length of credit history, which considers the age of the oldest account. Recent credit inquiries, generated when applying for new credit, are also recorded and can temporarily affect a credit score. Public records, such as bankruptcies, can appear on credit reports and impact creditworthiness. While tax liens and civil judgments were previously included, major credit bureaus generally no longer add these to consumer credit reports. Bankruptcies can remain on a consumer’s report for seven to ten years, depending on the type.

Your Rights and Access to Credit Information

Individuals have specific rights concerning their credit information, primarily governed by the Fair Credit Reporting Act (FCRA). This federal law promotes the accuracy, fairness, and privacy of information in consumer reporting agency files. Under the FCRA, consumers are entitled to a free copy of their credit report from each of the three nationwide credit bureaus once every 12 months.

The official federal website for obtaining these free annual reports is AnnualCreditReport.com. Requests can be made online, by phone, or by mail. Consumers can choose to request all three reports simultaneously or space them out throughout the year to monitor their credit more frequently. Additional free reports may be available under specific circumstances, such as if an adverse action is taken against you based on your credit report, or if you are unemployed and seeking employment.

For businesses, accessing credit reports involves different procedures and may incur fees. Business owners or registered corporate officers are the only ones authorized to request their company’s credit information. While the FCRA applies primarily to consumer credit, principles of accuracy and the ability to dispute information are generally upheld by business credit reporting agencies.

Correcting Errors in Your Credit Report

Identifying and correcting inaccuracies on a credit report is important. If an error is discovered, the first step involves disputing the information directly with the credit reporting agency that holds the inaccurate data. This requires explaining in writing what is incorrect and providing copies of supporting documentation.

Disputes can be submitted online through the credit bureau’s portal, by mail, or by phone. It is advisable to send written disputes via certified mail with a return receipt requested to create a record of submission. The credit reporting agency is required to investigate the disputed item within 30 days of receiving the dispute, unless it is considered frivolous. During this investigation, the disputed information may be marked as “in dispute” on the report.

In addition to contacting the credit bureau, it is also helpful to dispute the information directly with the company that furnished the data, such as a lender or creditor. Both the credit reporting agency and the information provider share responsibility under the Fair Credit Reporting Act for correcting inaccurate or incomplete information. If the investigation confirms an error, the information must be corrected or removed, and an updated copy of the report should be provided. If the dispute is not resolved in your favor, you have the right to request that a statement of dispute be included in your credit file.