Credit bureaus assign credit scores to your credit reports based on the way you have paid your bills, how much you owe, and the time it has been since you applied for credit. These scores allow lenders to predict whether you will be able pay your bills in a timely manner. They range between 300 and 850. A higher score signifies that you are able to pay your bills on time. These credit bureaus compile, synthesize, then present this information in order to lenders and other business.
Equifax, Experian, TransUnion are three of the major credit bureaus
Credit bureaus keep track of your credit and use it for determining if you are a good risk. There are many credit bureaus out there, but most lenders will use one or two of the major three. Equifax was first established as a retail credit bureau in 1899. By the 1920s, Equifax had offices all over North America and credit files that were used by millions of Americans.
Each bureau is different and offers different credit monitoring service models. TransUnion is primarily focused on consumer data. Equifax sells consumer data to retailers and government agencies. Both companies offer credit monitoring services to the general public.
They all receive free annual credit reports
Call the number above or visit the website to get your annual credit report for free. Within 15 days, the report will be emailed to you. It is possible to request the report at different times, up to four months apart. However, free credit reports do not give you a complete picture of your credit at any given time. A monitoring service can be a good option. They cost between $40 and $100 each year.
The information reported by all three credit agencies may be the same, but it could differ from one bureau to another. Because creditors don't need to report all three bureaus. Some mortgage companies might only report to one or two bureaus. It is crucial to review all three bureaus to determine if there are discrepancies. This can impact your credit score.
Each applicant must pass a background screening
Check your credit report to find out if anyone has been convicted. This is a good idea to avoid identity fraud and theft. These reports can be used to apply for loans, make utility deposits, and many other purposes. These reports include information such as identification, payment history, and a list with past and current credit cards.
Credit reports are provided by the 3 major credit bureaus, Equifax, Experian, and TransUnion. Each bureau has a different way of calculating your credit score, and the information may differ slightly. Understanding what each bureau does not do is essential for protecting yourself and maintaining good credit.
Each of them has a VantageScore credit rating model
FICO scores are still very popular, but VantageScore credit scoring uses an even more complex model. It includes factors such payment history, age, and credit account types. VantageScore also measures credit availability and trends. It is available free of charge on websites such as Credit Karma.
VantageScore began as a consumer credit reporting system in 2006. VantageScore 3.0 was launched in 2013. It quickly became the most widely used credit scoring model, helping over 40 million Americans to improve their scores. The new version, 4.0, was released in 2017, but many lenders still use VantageScore 3.0 for loan approval.