Credit Reporting Agencies: What They Are & How to Use Them

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You may know that your credit score is important and that having a high score can unlock more opportunities. But do you know where your score comes from?

Credit scores are the product of credit reporting bureaus or agencies, which are companies that maintain a running history of how you use credit and take out loans. 

Understanding what a credit reporting bureau is and how it operates can help you better understand your score. Join us in a crash course on credit reporting agencies, your credit report and how you can use these to get a better credit score.

What Are the Three Credit Reporting Agencies? 

A credit reporting agency (sometimes called a credit reporting bureau) is a company that compiles and sells credit reports. A credit report is a statement that has information about your credit activity. It also has information on the accounts you currently have open.

When someone looks at your credit report, they can see things like bankruptcies, the credit limit on your credit cards, the balances on loans you have out and more. Credit reporting bureaus collect this information from thousands of sources across the country.

There are three major credit reporting agencies in the United States: TransUnion, Equifax and Experian. Though each of these bureaus does the same basic things, the way each one reports information varies. It’s a good idea to read each of your three reports annually because your credit score and information can differ depending on which report you read.

What Does a Credit Reporting Agency Do?

Credit reporting agencies maintain credit information. When creditors, banks or other lenders work with you, they often forward this information to one or more of the three agencies. These items show up on your reports and can influence your score.

For example, if you pay off a credit card balance, this shows up as a positive item on your credit report and your score goes up. On the other hand, if you miss a payment, this will show up as a negative item on your reports and lower your score. Not every bank or lender reports to every company, so your reports can slightly vary by agency.

Under the Fair Credit Reporting Act, you’re entitled to one free pull of your credit report from each of the three major credit reporting bureaus. You can get your credit reports by submitting a request through Read each of your credit reports once a year to check for signs of identity theft and fraud.

If you notice any evidence of fraud on your credit reports, you can freeze your credit. A credit freeze is a credit report lock that prevents lenders from seeing your report or anyone from opening new accounts or items under your name.

Freezing your credit is free, won’t impact your credit score and each of the three credit reporting bureaus can help you freeze your credit. If you notice an error or suspicious item on your credit report, report it to the bureau.


The main difference between TransUnion accounts and other types of credit reports is its color-coded loan status system. TransUnion lists each of your accounts as “satisfactory” or “adverse.” If an account is in satisfactory condition, you’ll see a green box with an “OK” signal. This means that your payments on this account are up to date.

You may also see a white box with an “N/A” in it. This means that TransUnion doesn’t have up-to-date information on this account. 

If an account is in an adverse condition, you might see one of a few different colors depending on how far behind on payments you are:

  • A yellow box with a “30” means that you’re 30 days behind on your payments. 
  • An orange box with a “60” means that you’re 60 days behind on your payments. 
  • A red box with a “90” means that you’re 90 days behind on your payments. 
  • A red box with a “120” means that you’re at least 120 days behind on your payments.

TransUnion credit reports also have very thorough employment data in your personal summary. You may change, edit or add annotations to this section that indicates your most recent job and the type of position you held. Doing this will not change your credit score, but it can be helpful if you’re applying for a job that requires a credit check.


Equifax credit reports are easier to read than TransUnion and Experian reports. Equifax lists all of your accounts as either “closed” or “open” depending on whether you’re carrying a balance. The other bureaus group everything together based on the name of the account supplier, which can make it harder to tell which accounts still have outstanding balances.

If you’re reading a credit report for the first time, it’s a good idea to start with Equifax.

Equifax reports show you up to 81 months’ worth of payment data. However, if you closed the account or paid it off over 81 months ago, you may see a statement saying “No 81-Month Payment Data available for display.”


Contrary to popular belief, items on your credit report don’t say visible forever. Both positive and negative instances expire after a certain amount of time. Experian credit reports are unique because they list status details that tell you exactly when each item will be invisible on your report.

For example, let’s say that you paid off a student loan on time in June 2019. Since positive payment history remains on your credit report for 10 years, you’d see this comment under the account’s status details: “This account is scheduled to continue on record until June 2029.”

If you’ve made financial mistakes in the past and you’re worried about how long they’re going to “follow” you, your Experian credit report should be the first one you look at.

As you can see, each one of your credit reports is a little different. That’s why it’s important to take a look at all three of your reports once every 12 months. 

How to Use Your Credit Report 

So, you’ve gotten your free credit report from each agency — now what? Reading through your credit report can help you improve your credit score over time.

Here’s how to use your credit report for the biggest increases possible. 

Look for errors

Credit reporting errors are common. According to a report from the Federal Trade Commission, about 1 in every 5 people has an error on a credit report. These errors can lower your score, so it’s important to spot them and have them removed. Some of the most common credit report errors include:

  • Incorrect information. Review your name, middle initial, Social Security number, address and employment information on each of your reports and make sure it’s accurate. If it’s not all correct, it’s possible that your report might include data for someone with a similar name or address.
  • Accounts listed as “closed by lender.” If you closed a credit account, make sure there’s a note that says “closed by grantor,” not “closed by lender.” An account listed as “closed by lender” implies that your lender closed the account due to missed payments or fraud. This error can cause your score to go down.
  • Debts more than seven years old. Past financial mistakes aren’t supposed to follow you forever. Credit reporting agencies should remove bad debts and negative items after they’ve spent seven years on your report.
  • Duplicate accounts. Occasionally, a loan or account will end up listed twice on your credit report. This can make it look like you have twice as much debt, lowering your score.

If you spot any of these mistakes, contact the credit reporting agency that issues the report with the mistake. 

Catch identity theft fast

Do you see accounts, aliases or loans that you don’t recognize on your credit report? You might be a victim of identity theft. Reading your credit report is one of the best ways to find instances of identity theft. You might not even know you’re a victim until you see outstanding items on your credit report.

If you believe that you’re a victim of identity theft, keep a copy of your credit report and visit to file a report. 

See where you can improve

No matter which credit report you read, you’ll see all of your recent credit movements. Is your credit score low and you’re working to improve it? Reading your credit report can give you clues to any areas you need to improve.

For example, you might already know that you missed a few payments on your Visa card. But did you know that you were over 120 days late? Keep an eye on your credit report so you can see where you can improve as well as where you’re doing things right. 

Free Credit Monitoring with MoneyLion

Want to know your credit score or need an easy way to check a few of your reports? Do you want to learn more about how you can improve your score? Free credit monitoring from MoneyLion gives you instant access to your score, allows you to track your score over time and helps you create a plan for improvement.

MoneyLion even offers a score simulator tool that allows you to see how your score would change if you paid off an account, missed a payment, opened a new account and more.

All of this is available totally free from MoneyLion. Whether you want to improve your score or simply maintain great credit, opening an account with MoneyLion is the first step toward a healthier financial life. 

Take Charge of Your Credit Score

Once you have a bit of understanding and education under your belt, you’ll quickly find yourself reading your reports like a pro. If you’ve never read your credit report before, visit today to claim your free credit report copies.

There’s never been a better time to take advantage of everything that MoneyLion has to offer. Get ready to start on the path to a better score today by opening a free MoneyLion checking account. Download the MoneyLion app from the Google Play or Apple App store today to learn more and get free credit monitoring tools.  

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