"My credit score and credit history was restored as a result of your credit repair service. Thanks for you fast and professional service!"
--Susan Morgan
A credit bureau, credit rating bureau, or credit rating agency is a company that collects and provides information to develop information about an individual's credit worthiness. Credit Bureaus utilize the information they have collected to rank or "score" individuals ability to maintain and repay loans or credit. In the United States there are largely three main Credit Bureaus: Equifax, Experian, and TransUnion.
How do Credit Rating Bureaus work?Basically, Credit Rating Bureaus collect information, financial data, and other data on individuals from company's with which the Credit Rating Bureaus have relationships and from public sources. The Credit Rating Bureaus then utilize powerful databases and mathematics to analyze the information and perform a credit assessment or score individuals credit worthiness. For information on what a credit score is used for, please see our article: What is a Credit Score Used For?
How do Credit Rating Bureaus Make Money?Credit Rating Bureaus make money by collecting information, financial data, and other data on individuals, analyzing that data and then selling the results of that analysis to customers, such as Banks, Employers, Government and other Companies. Although it may seem unfair that the Credit Rating Bureaus make money on peoples personal data, it is generally accepted as a good practice because the result is a reduction of the risk that lenders, landlords and employers have to take in the course of their business. The reduction of risk is directly the result of lenders, employers and landlords being able to accurately predict individuals credit worthiness based on their credit scores provide by the Credit Rating Bureaus.
Why Credit Repair Firms are needed?Sadly, because Credit Rating Bureaus make money from the information they provide, it is not in their interest to be perfectly accurate at an individual level. The Credit Rating Bureaus customers' pay the same rates whether an individuals credit score is good or bad. The Bureaus just provide a credit score. Alarmingly, the result of this structure is such that many individual's credit scores are not accurate, which can financially penalize credit worthy people (see Why should I repair my credit score?). It is very difficult to correct inaccurate or completely wrong credits scores, because the Credit Rating Bureaus do not want to spend the money or effort on correcting their information, they only want to sell their information. Consequently the Credit Rating Bureaus utilize a form letter and number of other stalling methods with those individuals attempting to correct their credit scores or credit ratings. It has been proven that the easiest, quickest and safest way to induce the Credit Rating Bureaus to make their information accurate is to use a Credit Repair Firm (see What is a Credit Repair Firm?).
What is a Credit Repair Firm?Credit Repair Firms are generally Law Firms that specialize in dealing with the Credit Rating Bureaus, particularly for the purpose forcing the Credit Rating Bureaus to adjust their information accurately on behalf of individuals. Thus "repairing" individual's credit scores. See Why Are Credit Scores Broken for more information.