To find ways to increase credit rating, first we have to know how the whole credit industry works…

Credit reporting agencies are for-profit companies that gather and sell information about a person’s credit history. They sell credit information on consumers to banks, mortgage lenders, credit unions, credit card companies, department stores, car dealers, insurance companies, landlords, and employers. These companies and individuals use the credit information to supplement applications for credit, insurance, housing, and employment.

Credit reporting agencies may also provide identifying information concerning a consumer – name, address, former address, place of employment, and former place of employment – to government agencies. If a government agency is considering extending credit, reviewing the status of an account, or attempting to collect a debt, granting a license or other benefit, or investigating international terrorism, the agency is entitled to the complete credit report.

There are three major credit reporting agencies: Equifax (www.equifax.com), Experian (www.experian.com), and Transunion (www.transunion.com). Recently a fourth, Innovis (www.innovis.com), has gained some popularity. There are also thousands of smaller credit reporting agencies, known as “affiliates”. Open up your yellow pages and look under “Credit Reporting Agencies”. You may see none, one, two, or all three of the major credit reporting agencies. You will probably also see dozens of affiliates. These affiliated companies get their information from the 3 major credit bureaus: Equifax, Experian, and Transunion.

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