What Is a "Credit Bureau"?

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Most of us know what a credit card is, but what exactly is a credit bureau? You may have come across the term once or twice before, but here is a more specific definition for this institution.

Definition of Credit Bureau

Credit bureaus are agencies that record a person’s credit score and then report that information to agencies and authorized individuals who request the score information. The three largest credit bureaus are Equifax, Experian, and TransUnion. If you’ve ever requested your credit score, you’ve almost certainly (either directly or indirectly) gotten it from one of these companies.

Although they’re different, the credit bureaus compile their scores based on a number of similar factors. These factors include the length of a person’s line of credit, the ratio of debt to available funds, a person’s number of credit cards, and more.

Credit Bureaus and the FDCPA

A person’s credit score can be incredibly important if that person is trying to apply for a credit card, personal loan, or home loan. A credit score can also affect the types of payment plans you’re eligible for when it comes to buying a house or a car.

Unfortunately, some unscrupulous third-party collectors will use the importance of your credit score to their advantage. They may threaten to report false information to a credit bureau in order to pay a debt, and occasionally, they might even go through with it. This is a blatant violation of the FDCPA, and if this happens, you should consult an FDCPA attorney to figure out a plan of attack.