Meet the Three Major Credit Bureaus

You know your credit report and credit score are important elements of your overall financial well-being. But what do you know about the companies that collect consumer credit information to generate credit reports and credit scores?

Introducing the Major Credit Bureaus

Credit bureaus – also known as credit reporting agencies – are companies that house large databases of consumer credit information. When a creditor, such as a mortgage company or landlord, requests your credit information to assist in their decision-making processes, the credit bureaus may provide your credit report and credit score.

While many credit reporting companies exist, three national credit bureaus are the largest – Experian, Equifax® and TransUnion®. Most of the other credit reporting agencies are small and localized to specific communities or industries. The credit reporting industry is similar to the banking industry, which has many small community banks that serve certain areas and fewer very large banks that serve the entire country.

Different Information from Different Bureaus

Although they perform the same function and operate in much the same way, the three national credit bureaus are still separate companies, so small variances can occur between each company’s credit reports and scores. Common differences include:

  • A credit inquiry will appear only on the report generated by the company with whom the creditor placed the inquiry, and not on the reports generated by the other two credit bureaus.
  • If a creditor reports your balance to different bureaus at different times of the month, the balances on the different credit reports won’t match.
  • If one bureau tracks information only monthly, its reports won’t match a bureau that tracks daily.
  • Infrequently, an account or negative item may appear on only one bureau’s report.

Different Scores from Different Bureaus

It’s very common for your credit scores to vary from bureau to bureau. That’s because each bureau has slightly different information and different credit scoring models that they use to calculate credit scores. The variances in scores are usually small, however, and if you find a large discrepancy it may indicate an error on one or more credit report, or even be a sign of identity theft.

Under the Fair Credit Reporting Act, every American consumer is entitled to receive one free copy if his or her credit report from each of the three major credit bureaus once a year. You can obtain yours at Credit scores are not free, but each of the three major credit bureaus makes scores available to consumers for a fee.