If you are not clear on why you need to check all the three credit scores from time to time, you need to understand how the bureaus work. The three bureaus all have distinct proprietary databases that collect data from your creditors and lenders.
Collecting information
The data is generally speaking, information on your credit card usage and loans taken in the past. Experian, TransUnion and Equifax all collect data regarding your credit history. They also have information on all the creditors who have requested this information from the bureaus.
The three bureaus have different ways of computing the rating. This means that each of them will provide varying reports regarding your credit rating. Besides that, some lenders will only provide information to only one of the bureaus. This means that to some lenders the ratings will be higher than the other one from a different bureau.
Lenders and Creditors
Some lenders will require that you have a certain score from all the three credit scores, before you qualify for lending. This could apply when you are approaching the lender for mortgage or mortgage refinancing. Lenders for automobile loans often only check one of them, but this is not always the case with the mortgage creditors.
The way you manage this information will play a great role in determining whether you will secure loans in future. They also determine interest rates on the money lent to you. You therefore need to keep tabs of what information these bureaus have from your creditors.
Ensure Accuracy
You also need to keep checking to ensure that information is correct. This is not only important to ensure that the information lenders get from the 3 credit scores is accurate, it could serve as a flag for unscrupulous people attempting to steal your information or attempting identity theft.
You are entitled to one free report every year. You can take advantage of this to check if there are any mistakes from the ratings. In case of a mistake, you may ask for the necessary corrections to be made so that he report is error free.
You can use the information from all the three credit scores to ensure that your rating is favorable in case you need to approach a lender. Some lenders will provide you with the rating you need to have to be eligible for lending. You may then take the information and work on your ratings accordingly.
Collecting information
The data is generally speaking, information on your credit card usage and loans taken in the past. Experian, TransUnion and Equifax all collect data regarding your credit history. They also have information on all the creditors who have requested this information from the bureaus.
The three bureaus have different ways of computing the rating. This means that each of them will provide varying reports regarding your credit rating. Besides that, some lenders will only provide information to only one of the bureaus. This means that to some lenders the ratings will be higher than the other one from a different bureau.
Lenders and Creditors
Some lenders will require that you have a certain score from all the three credit scores, before you qualify for lending. This could apply when you are approaching the lender for mortgage or mortgage refinancing. Lenders for automobile loans often only check one of them, but this is not always the case with the mortgage creditors.
The way you manage this information will play a great role in determining whether you will secure loans in future. They also determine interest rates on the money lent to you. You therefore need to keep tabs of what information these bureaus have from your creditors.
Ensure Accuracy
You also need to keep checking to ensure that information is correct. This is not only important to ensure that the information lenders get from the 3 credit scores is accurate, it could serve as a flag for unscrupulous people attempting to steal your information or attempting identity theft.
You are entitled to one free report every year. You can take advantage of this to check if there are any mistakes from the ratings. In case of a mistake, you may ask for the necessary corrections to be made so that he report is error free.
You can use the information from all the three credit scores to ensure that your rating is favorable in case you need to approach a lender. Some lenders will provide you with the rating you need to have to be eligible for lending. You may then take the information and work on your ratings accordingly.