People talk about credit cards, credit limits, credit history, credit scores, and credit reports all of the time. But what do all of these terms mean? Who decides what your credit score is and what is on your credit report anyway?

People may understand what their credit scores are, and what comes up on their credit report, but perhaps they do not understand who puts it all there. Of course YOU are responsible mainly for what score you get and what goes on your credit report based on your credit history, but who takes all that information, puts it into an equation, evaluates it, and scores it?

The people who are responsible for calculating your credit score and updating your credit report are part of what is called a credit bureau. These are also called credit reporting agencies. But still, who are these credit agencies, what all do they do, and how does that affect you and your ability to buy on credit?

Credit Bureaus

The three main credit bureaus are Experian, Equifax, and TransUnion. They are the primary sources that provide a person’s credit report. They are who you go to when you want to get a copy of your credit report, and they are who you talk to when you have an argument concerning possible errors on that report. They also calculate your credit score, and all of this is based on your credit history, or the management skills you have developed or lacked within the time you have held a credit account.

You’re Being Reported

Whenever you do business using credit, the lender you got the credit or loan from, like a bank, credit card company, or department store, is connected to the credit bureaus. They report, to the credit reporting agencies, your practices concerning your credit card or loan payments, how far in debt you are, how close to the limit you are, and how much extra you may be paying on your bills each month. They report anything and everything that you do, whether good or bad, that will portray how well you can handle credit.

Three for Free

Credit reporting agencies allow you to access your credit report once a year for free. This means that you can get a report from all three of the major bureaus for free once a year, therefore allowing you a total of three free credit reports per year. This is a more recently added right given to credit holders, and has only been in effect nationwide for a few years.

It’s easier to understand your credit scores and your credit report once you understand who organizes them. It is also helpful to know where to go if you have a problem with either of these. Do not be afraid to take any problems you have to these credit reporting agencies, because since they have so many people and reports to worry about, they cannot fix your problems without you helping them to recognize those problems.