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How credit reporting agencies work
As credit increased throughout the world, there arose a great
need to issue reports concerning those who are NOT a good credit risk as well as
those who are CREDIT WORTHY! Because of this great need, credit reporting
agencies were formed several years ago. These agencies, known as credit bureaus,
receive information about consumers from banks, loan companies, credit card
companies, department stores, as well as from other credit and lending sources.
Credit bureaus earn their profits by giving a computer
printout showing a financial and credit profile of any individual (such as you
or me). These reports are requested by a lender or a credit issuing firm from
which you have requested credit.
Lenders will base their acceptance or rejection of your
application for credit based on the
information about you in your personal credit report. If your credit report
shows that you have been reliable in the past, then in most cases credit will be
granted. What if your report shows that you have NOT been reliable in the past?
Perhaps you have been like others who have encountered circumstances beyond your
control which made it IMPOSSIBLE for you to meet your credit obligations. What
if your credit report shows that you defaulted on a particular account or were
constantly LATE making payments? This of course can be most embarrassing, and
usually leads to CREDIT DENIAL!
Credit reporting agencies sell information about you to
BANKS, DEPARTMENT STORES,
CREDIT CARD COMPANIES, LOAN COMPANIES, etc. These credit bureaus keep on file
information concerning you and your credit, but they do not make any final
judgments as to your credit worthiness. The decision is up to the lender which
you have dealt with to decide and report to the credit bureau. When you receive
a copy of your credit profile, you may find some of the following information in
your report. Your occupation, place of employment, income status, residence
record, marital history, court and arrest records, and most important, details
on payments of your past and present bills and loans.
You have the ABSOLUTE RIGHT to know what is in your consumer
credit report! Because it is YOUR personal credit file, you should want to know
what information the credit bureau is giving out concerning your good name and
your credit! Most people have thought, and still think, that if they have an
unfavorable credit report or history that there is NO WAY to change it, and if
they want to obtain NEW CREDIT that it's impossible! DON'T BELIEVE IT! You can
change your credit report for the better. You can change and correct any and all
OUTDATED or INCORRECT INFORMATION that YOU choose!
Remember, it's up to you! No one will do it for you! The
first step in correcting information on your report is to obtain a copy of your
personal credit profile.
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