Information about your credit activity is maintained by companies known as credit bureaus. Credit bureaus receive credit information from financial institutions with which you have a relationship. In turn, the bureaus provide lenders with information that enables the lenders to assess you as a credit risk. Under the Federal Fair Credit Reporting Act (FCRA), credit bureaus are known as consumer reporting agencies.
In the United States, there are three major credit bureaus. These are Equifax,, and TransUnion. It is important to know that the individual credit bureaus do not make the decision to approve or deny a credit application. Instead, they provide the information that lenders use to make these decisions. The institution to which you are making the application makes the ultimate decision.
To better gauge your credit history, the three credit bureaus provide a numerical score that represents the information contained in your credit report. This value is known as your credit score. To determine your credit score, five factors are considered: your payment history, level of debt, types of credit, length of credit history, and applications for new credit. Each of these factors has a different weight in the calculation of your credit score, with payment history counting the most.
Since there are three different credit bureaus, it is quite possible that you could have three different credit scores. Why? To start, each of the credit bureaus operates independently. Since all of your financial institutions may not report to all three of the credit bureaus, it is quite possible that each bureau has different information about your credit history. The difference in information is usually evident in your credit score. Depending on the information that each bureau has, your credit score may vary greatly from one bureau to the next.
Not only is it possible for the three credit bureaus to have different credit information, they also use their own variation of the credit scoring calculation. This, too, plays a part in the difference in your credit score among different bureaus.
When you are interested in seeing your credit score, it is a good practice to obtain it from all three credit bureaus. This is especially true if you are preparing to apply for a loan or credit card. Since there is no sure way to know which credit bureau a lender will use to check your credit score, it is better to be aware of all three of your credit scores.