Do I need to be concerned about which credit bureau the lender uses?

When lenders review your credit report to make a decision whether to grant you credit, they purchase one credit report from one of the three credit reporting agencies (CRAs) – Equifax, Experian and TransUnion. Mortgage lenders are the exception and purchase reports from all three.  You don’t know which credit bureau they used, unless you are turned down for credit. You don’t have to be concerned about the credit bureau selection – the credit reports at the three bureaus are basically the same.

Same data contributors

The same companies contribute information to all three bureaus. The data contributors include banks, credit card companies, retailers, mortgage lenders, auto lenders, credit unions, personal finance companies, student lenders, collection agencies and public records. Public record data is supplied by one company, PACER, which provides this data to all three bureaus.  There can be slight variations, with data contributed by local or regional companies and in the companies that review your credit report and post an inquiry.

In the past, there were large differences in the data among the three bureaus. In fact, some of the major credit grantors conducted comparisons on the credit data at each of the three bureaus to determine which had the most accurate and complete data. The same data was matched up at all three to make comparisons. Since there were regional differences, the credit grantors developed “preference tables” that selected the credit bureaus by states or ZIP codes.  There are more national lenders than in the past, and regional lenders also contribute data to all three. Now the data at any of the three bureaus is interchangeable. That is why price is a key factor in determining which credit bureau the major lenders use.

How does this affect you? It really isn’t important which credit bureau the lender uses. The data is consistent at all three, so it won’t make a difference in you qualifying for a loan or credit card or the interest rate you pay.

Credit Expert Witness, John Ulzheimer, is the President of Consumer Education at SmartCredit.com, the credit blogger for Mint.com, and a Contributor for the National Foundation for Credit Counseling.  He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry.  Follow him on Twitter here.

Categorised in: Credit Cards, Credit Monitoring, Credit Report, Credit Score, Getting Credit

This post was written by John Ulzheimer