Well since you asked. NO ONE. There is no law requiring any company to report to any of the credit bureaus. Many companies do, however, because they see value in having a resource to be able to judge the risk in extending some form of financial credit to a person or a business. This ranges from a car purchase, to a home, to a new television to a lease on an apartment. In theory, this makes good sense. Unfortunately the big three credit bureaus are in collusion with one another and have become, in simple terms, data mining companies. They do a better job than the NSA as far as mining your personal financial data. The banks sell it to them, companies such as Nexis-Lexis sells it to them. They then turn around and sell all this data they collected to, pretty much, whoever is willing to pay the price. Where do you think all those “pre-approved” credit card offers or auto financing offers come from? (by the way, that’s all bull..sorry family friendly here..false). A bank goes to the credit bureaus and says we want to buy the names and addresses of everyone you have with a credit score over 640 (for example). An automotive company wants the name and address of anyone with a credits score over a 680. A furniture and appliance rental company wants names and addresses of everyone with a score UNDER 580. See how this works? Transunion, Equifax, and Experian milk this cash cow to the tune of an estimated $7-$8 billion a year in profits. Selling information on people with BAD credit is extremely profitable. Predatory companies want to dangle credit at people with bad credit, they will give it to you with a ridiculous annual fee and a 30% APR. Need a computer? XYZ rental will do a rent to own agreement that when you are done you will have paid 5 times what the computer is worth. Need a car? ANYONE can find someone to finance a car, and with bad credit you will end up paying for a high mileage used car what an owner of a new Mercedes would pay. Don’t even get me started on Payday loans and Title loans. Some states they are illegal. They should be illegal in ALL states. What has happened is a system has been created that is designed to hold you down. The rich stay rich, the rest you have to know what you are doing to negotiate the minefield in front of you. This is where we are part of the solution. After we get you back on track a good financial adviser is a wise investment.
You can protect yourself from having your information sold. Go to www.optoutprescreen.com and follow the instructions to opt out. The bureaus will still collect their information, but it will be illegal for them to sell it if you opt out.
This also , partly, explains why all three bureaus will have different scores. Not all companies report to all three. Some may just report to one. The bureaus charge for access to their electronic reporting system so some companies will just report to one bureau. The Credit Bureaus make money from practically everyone.
OK, so you understand the Credit Bureaus and what they do and how they make money. So what’s the problem then? The problem is that they have so much information flowing in, anyone over 18 the bureaus have data on you, they cannot manage it properly. They try to electronically take information, reduce it to a simple code and outsource it to Southeast Asia where someone in a cubicle enters in to the system.
The result is the Federal Trade Commission estimates that a conservative figure of 40 MILLION Americans have errors on their credit report. As I live and breathe this stuff I can tell you that number is way off. I read and dissect credit reports daily. I have yet to find a mistake free credit report. Some errors are small and benign, most are negatively effecting the credit score. The Federal government requires, by law, they only report accurate, verifiable, and timely information. They do not do this and are fined MILLIONS of dollars each year. Peanuts to them. Their errors may have cost you the better interest rate on that car you recently purchased. Caused you to be declined for credit. Cost you a job opportunity. At the least run your free annual report and make sure you recognize EVERYTHING on it. The ONLY SITE THAT YOU CAN ACCESS YOUR REPORT FOR FREE EACH YEAR IS: www.annualcreditreport.com That’s the one. Not the one that they sing about on TV commercials. This is the site set up by the Government and the only annual free report site. Not scores, those you need to pay for. But the reports themselves, that is it. Do this annually and if you see something you don’t recognize give us a call. Advise is free. If its a matter of a couple of things we will tell you what to do, even send you some free letter templates and some how to do it yourself instructions.