A "Credit Bureau" (also called a "Credit Repository") is a privately owned company that assembles and stores records on the payment patterns and credit history of millions of people. They generate billions in profits by selling these records to potential lenders.

They are not government agencies and are in no way affiliated with the US government.  But they nevertheless have enormous power and influence over the lives of individual Americans!

In the United States there are three major credit bureaus. They are:

TransUnion
Equifax
Experian

 Collecting information from public records, lenders, debt collectors and the court system, credit bureaus put together information on individual citizens into a file called a "Credit Report."

Your credit report holds information on your open and closed accounts with mortgage lenders, auto loan lenders, credit card companies, and merchant lenders.

It also holds public records such as repossessions, court judgments, liens, foreclosures and bankruptcy.

Now when a lender is evaluating the credit worthiness of a loan applicant he will contact one (or more) of the credit bureaus and purchase a copy of the credit report for that person.  Based on the information in the credit report and the "Credit Score" the lender will decide whether the borrower is a good risk or a poor one.

Based on that decision the potential borrower may be granted or denied a loan. If he is granted a loan, the credit report and score will determine what interest rate he will have to pay.

Your "Credit Score" is a 3 digit number assigned to you by each credit Bureau based on your credit report. The "Credit Score" is intended to reflect your credit worthiness. The higher your score is, the better your credit.

This shows you the range of scores.

Below 585                   Very poor
585 - 669                     Poor
670 - 699                     Fair
700 - 729                     Good
Above 730                   Excellent

The individual bureaus have different ways of determining a credit score, and so your credit score will be different based on the credit Bureau reporting it. But they are likely to be in the "ballpark".

To get your credit score and credit report, click here.

In computing your credit score the credit bureaus consider five basic factors in various degrees, approximately as follows;

 History of Payments  - 35%

Have you made timely payments on your bills? 
Have there been late payments? 
How late have they been?
How frequent were the late payments?
Are there any accounts in collection?
How many?
Has your car been repossessed for nonpayment?
Does your credit report show a bankruptcy?

 Current Debt Level - 30%

What is the total amount of all your debts?

Length of Credit History - 15%

How long have you carried debt? Lenders would rather see a longer history (of positive accounts) instead of a short one.

Types of Credit - 10%

There are primarily two classes of accounts, "revolving" or "installment."

Car and mortgage loans are installment loans. You pay at predetermined intervals and pay a set amount with each payment.

Revolving accounts (like credit card accounts) are more flexible and are not paid in predetermined amounts, but they often do require a minimum payment.

It's best to have a "healthy mixture" of both kinds.

Pursuit of New Credit - 10%

Are there are many "inquiries" on your credit report (potential lenders buying your credit report)?

Credit bureaus keep records on millions of citizens, so it should come as no shock that there will be a few mistakes. But sadly there are more than just a few. In fact, it's estimated that anywhere from a third to a shocking 90% of all credit reports have mistakes.

Let's put it differently - even using very low figures there's a 1 out of 3 chance that there are errors in your credit report!

Now considering the importance of your credit score those are NOT very good odds - and that's looking at the LOWEST estimate!

Just how many mistakes would it take to negatively affect your credit score?

Now one would think that when it comes to something as important as your credit ... something that impacts your life to such a degree ... that the credit bureaus would try harder to make sure there are no inaccuracies in your credit report.

You may be thinking "Well, there ought to be a law ..."

Fortunately there is! The United States Congress passed one to address the problem ... the Fair Credit Reporting Act, or FCRA.

Under the FCRA citizens have the right to challenge the accuracy of information in their credit report. The credit bureaus have 30 days to investigate consumer disputes. If they do not verify the accuracy of the information within those 30 days, they are required under law to delete it.

Great news! But there's a problem.

Looking at it from the credit bureaus' perspective it's an unwelcome law. There's nothing in it for them except lost time, money, and productivity.

So they put roadblocks in the way of the consumer.  They know how to utilize a "loophole" in the FCRA, the "frivolous" issue. The credit bureaus don't have to investigate a dispute they deem "frivolous".

And here's the worst part. Initially it's the credit bureaus themselves who get to decide if the dispute is frivolous.

Talk about putting the fox in charge of the henhouse!

As you might imagine the bureaus are not hesitant to label a dispute frivolous whether or not it actually is. And while the consumer can always challenge them in court (which is not a big problem if you've just won your state lottery) most people don't have the resources to hire the high priced lawyers the credit bureaus can ... especially those who are paying appallingly high interest rates because of mistakes on their credit report!

We're well aware of the obstacles the credit bureaus use to frustrate citizens and obstruct their efforts to get mistakes deleted from their credit report. Utilizing your rights under the Fair Credit Reporting Act, we help you challenge the correctness of data on your report … to delete accounts that could be negatively impacting your credit score.

We know how to deal with the credit bureaus and make things happen!

Although the credit bureaus would like to discourage you from seeking help in challenging the correctness of your credit report, don't ever let them convince you it's illegal to do so. It most definitely is NOT!

Another trick they like to pull is to reply to your dispute and try to convince you that utilizing help is a waste of your money and that all credit repair companies are scammers! And while it's true that some are, what the bureaus are trying to do is NOT to protect consumers ... it's to protect credit bureau profits by putting roadblocks in the consumer's path!

Under the FCRA every citizen has the right to challenge - on his own - information on his credit report. But likewise, everyone also has the right to prepare his own tax return, and yet many people would rather hire an accountant to do their taxes rather than try to navigate the complexities of the tax code.

There will be variation in results, but most of the time there is going to be major improvement.

And bear in mind!

When it comes to your credit, ANY improvement can make a big difference in on your personal and financial life, in the form of lower interest rates, the ability to get loans that were otherwise unavailable, and less stress and emotional anguish.

No one (who's at all honest) can promise results when it comes to fixing bad credit. And no REPUTABLE company will.

No one's personal situation is the same. But in most every case there will be major improvement to one's credit report and credit score ... improvement that will make it possible for the client to get a mortgage, car loan, or a credit card ... and at a far lower rate of interest.

Don't forget - depending on your situation just ONE error on your credit report could mean a difference in your credit score - and in whether you can buy a home or not.

That will depend on your own personal circumstances. It took many years to form your current credit history, and it's not realistic to expect outstanding credit overnight.

Nevertheless, in some cases there will be major improvement in just a little over a month. Other times it may take a few months. And in rare cases it could take up to a year or more.

But taking an average you can expect major improvement in your credit in 4 - 8 months time.