Credit Report - Credit Bureau - Credit Report Bureau

A credit bureau, also called credit report bureau (US), or called a credit reference agency in the UK is a company that makes available consumer credit info on individual borrowers.

Credit bureaus help lenders determine credit worthiness, which is the ability to pay back a loan, and can dramatically affect the interest rate applied to loans that are applied for. Interest rates are not the same for every individual, but are based on what is called risk-based pricing, which is a form of price discrimination based on the varied expected costs of different individual borrowers, as reported in their credit rating or credit report rating.

Today credit bureaus or credit report bureaus collect and collate all personal financial data on both individuals and businesses from the data furnishers with which the bureaus have a working relationship. The data furnishers are all the businesses, the utilities, any debt collection agencies, any public institutions, and the courts (for example public records) that an individual consumer or business has had a relationship with or experience with.

The data furnishers report the total experience with the individual consumer or business to the credit bureaus or credit report bureaus. The data and information provided by the data furnishers as well as any collected by the credit bureaus are then put into the credit bureau's or agency data repository or files. This information is made available by request to contributing companies for the purposes of assessing credit and credit scoring.

There a large number of individual or consumer borrowers, so these credit scores can be mechanistic. Saying it another way, the various credit bureaus gather data from many different sources and apply an algorithm to determine the likelihood that an individual will repay any given debt compared to the frequency that other individuals in very similar situations have defaulted in. Most, if not all, consumer welfare advocates advise all individuals to review their credit reports at least once annually to ensure that the credit reports are accurate and contain no errors.

The commercial credit reports and scoring, which report the statistic the ability or likelihood of a paying business creditors, also are available, such as the Paydex score from Dun and Bradstreet and the credit bureau Experian Intelliscore.

Credit Report Bureau - Credit Bureau - United States

In the US, the legal term for a credit bureau under the federal Fair Credit Reporting Act (FCRA) is a consumer reporting agency — often abbreviated in the industry as CRA, however it is seldom used among consumers, often preferring to the more common credit bureau or credit report bureau.

In the US, the key credit report bureaus or credit bureau consumer protections and general rules or governing guidelines for both the credit bureaus and data furnishers are the Federal Fair Credit Reporting Act (FCRA), the Fair and Accurate Credit Transactions Act (FACTA), the Fair Credit Billing Act (FCBA), and also Regulation B.

There are two government bodies that share the responsibility for the oversight and accuracy of the credit bureau data. The Federal Trade Commission (FTC) watches over all the consumer credit bureaus. And the Office of the Comptroller of the Currency (OCC) charters, regulates, and supervises all the national banks with regard to any credit bureau reporting.

Most of the United States consumer credit information is collected and kept by all four of the national credit reporting agencies: Experian (which purchased in the past the files and other assets of TRW), Equifax, TransUnion, and lesser-known Innovis (purchased from First Data Corporation in 1999 by CBC Companies). All of these organizations are for-profit entities and have no government affiliation.

Though they are all competitors, they have formed a trade organization called the Consumer Data Industry Association (CDIA) which establishes credit reporting standards. The current reporting standards that are accepted by the four CRA's are Metro and Metro2. The Metro2 standard is noted in the annual CDIA publication, called the Consumer Credit Reporting Guide, which is updated every September.

Finally PRBC (Pay Rent, Build Credit, Inc.) is a lesser known national alternative credit bureau. It was incorporated in March 2002.  PRBC helps consumers to self-enroll and build a positive credit file by self-reporting their on-time payments (such as rent, utilities, cable, and phone) that are not automatically reported to the three well known traditional credit report bureaus or credit bureaus.

Commercial Credit Bureaus

In the United States, there are only three business or commercial bureau repositories: Dun & Bradstreet, Experian Business, and Equifax Small Business Financial Exchange (SBFE).

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