Houston Credit Repair Coach Explains the Credit Bureau’s Secrets
If someone asked you “What exactly is a credit bureau?” would you know? Of course these credit bureaus have a lot of questions surrounding them. The point of credit bureaus is simply to store payment history, credit and collection records, and certain legal details about consumers and businesses.
These records are sold (emphasis on sold) to creditors when a business or consumer applies for credit. The three most widely recognized U.S. bureaus are Equifax, Experian and TransUnion. Even Dun and Bradstreet Corp is considered a credit bureau that is known for reporting corporate credit history exclusively. And don’t forget about the emerging Innovis.
Do you think you or your business would likely make a mistake if you needed to keep track of over a billion records and two billion transactions each month? Of course you would simply because nobody is flawless.
Most credit report mistakes go uncontested, but most people don’t know that just about 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 Fair Credit Reporting Act (FCRA) and the Fair and Accurate Credit Transactions Act of 2003 (FACTA) now establish the obligations for credit bureaus to maintain fair and accurate records which is a big improvement. The Act tells the Bureaus how to respond to consumer complaints of inaccuracies and requires them to provide a way for consumers to view their records.
Credit reporting bureaus are still businesses that need to make profits like any other. Their profits are derived by charging banks, lenders, credit card companies or utility companies for accessing customer’s credit files. This also means that looking into your credit disputes costs them resources, money, and time to investigate.
Here is a little known truth about the credit reporting bureaus:
You can have up to 92 varying scores at any given time. Reports and scores are generated instantly whenever they are requested by you, a creditor, or lender. There can be up to 23 individual scores for each of the credit bureaus. Yes, this does include Innovis.
The score you receive will differ based on whether a major reporting bureau ordered it or whether an online company requested it. It also depends on which profile has been applied to you during the request.
When you request a report from an online service for example, there are usually about 18 variables for identification that have to match exactly. You are more likely to get accurate information if a high percentage of information syncs up. When the credit bureaus pull a report for a lender, only about 9 elements need to sync. So, more errors and erroneous information may appear on your score which can drop your score.
There are some allegations surrounding credit bureaus specifically giving lower credit scores than are actually true as their way of avoiding a potential law suit from a lender in the event that the borrower can’t repay the loan.
Wow. So are they protecting you? Or just protecting themselves?
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