Credit Reporting Agencies

Fiscal Fitness Part II — Understanding the “Big Three” Credit Reporting Agencies

This second article in our Fiscal Fitness series outlines the basics of how the “big three” credit reporting agencies (CRAs) work. Understanding how CRAs impact your credit score is another great step to take in keeping your credit in shape.

1. Who are the credit reporting agencies?

The three largest U.S. credit reporting agencies— Experian, TransUnion and Equifax — are known as the “big three.” Their two-fold function is to collect information about consumers and report it to lending institutions and other creditors upon request. CRAs are mysterious entities to many consumers. You know they exist and how they can affect you. But how can you work with them and take an active role in maintaining a good credit score?

Credit reporting used to be a closed system, and consumers may have only received a letter indicating they were denied credit. Now, the Fair and Accurate Credit Transactions Act of 2003 (FACTA) gives U.S. consumers the right to request one free copy of their credit report from each of the big three CRAs every year. Request your free credit report online at or by calling 1-877-322-8228.


2. Common credit reporting errors

If you find an error on your credit report, it’s important to inform the CRAs right away and have it removed. Here are some of the most common credit report errors, according to the Public Interest Research Group (PIRG).

  • Multiple credit reports associated with your name at different addresses.
  • Information on someone else under your name.
  • Duplicate entries of either positive or negative credit events.
  • Incorrect public record information such as court records or bankruptcy reports that are wrongfully associated with your name.
  • Credit limit information missing from a credit card company.
  • Erroneous information caused by identity theft.


3. Notifying the CRAs of an error in your credit report

TransUnion and Equifax accept disputes either online or by mail. Experian only accepts online disputes. To ensure that a mistake gets corrected as quickly as possible, contact both the CRA and creditor that provided the incorrect information. Both parties are responsible for correcting inaccurate or incomplete information in your report. When you contact the CRA(s) and/or the creditor, follow these steps.

  1. Describe the information you believe to be inaccurate. If you’re disputing an error by mail, enclose a copy of your credit report with the items in question circled. Keep a copy of your dispute letter and any enclosures.
  2. State the facts and explain why you dispute the information.
  3. Request a deletion or correction.

You can expect this process to take between 30 and 90 days.

By understanding CRAs and how they work, you can ensure that your credit score is accurate, and that you’re receiving the benefits you have earned. For more information on CRAs, visit


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