A credit reporting agency (CRA) is an organization that collects financial information from data furnishers. These data furnishers are typically creditors, lenders, utilities, debt collection agencies and the courts (i.e. public records). With the information they collect they systematically create a credit report for consumers. The reports are then sold to other creditors, lenders, employers, insurers, and other financial institutions that you wish to do business with.
Credit reporting agencies are typically referred to as credit bureaus. The three largest credit bureaus in the US are Equifax, Experian and TransUnion. It’s important to note that credit bureaus are for-profit companies and not government agencies.
CRAs are governed under the Fair Credit Reporting Act which, among other things was put into place by the FTC to make sure the credit bureaus were reporting accurate information. The FCRA also allows consumers to request a free credit report from each of the credit bureaus once a year for free. It also allows consumers to dispute any information on their credit report that is questionable, unclear, or inaccurate.
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