What does a credit bureau do? - Building Credit History FAQ


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Credit Card Applications » Questions » FAQs » Building Credit History » What does a credit bureau do?

What does a credit bureau do?

Answered on | Updated on March 8th, 2013
The content is accurate at the time of publication and is subject to change.

Credit bureaus collect information about consumers’ financial behavior so potential creditors, employers and landlords can make informed decisions about whether to extend lines of credit, rent apartments, or make employment offers.

The three major credit bureaus – Experian, Equifax and TransUnion – record personal information such as address history, birthdate and Social Security number, as well as account history (when accounts were opened, if they were closed by the consumer or by the credit issuing agent), payment history and other financial details. They do not have access to employment or income information.

Credit scores are assigned using on the information that credit bureaus collect. FICO scores are based on the following elements:

  • Payment history: 35%
  • Available credit or debt-to-credit ratio: 30%
  • Length of credit history: 15%
  • New credit requests: 10%
  • Mix of credit types: 10%

To achieve the best possible credit score, it’s important to take all the above factors into consideration.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
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