What is credit?
Simply stated, it is borrowed money. It signifies the amount of trust a creditor has in you that you will in fact repay your borrowed funds pursuant to the agreed-upon parameters. The amount of trust a creditor has in you is directly translated into the amount of money they will let you have access to and the terms (strict or less strict, expensive or less expensive) in which you will be asked to repay.

What is a credit bureau and what does it do?
A credit bureau is a clearinghouse for credit history information. Credit grantors provide the bureau with factual information on how their credit customers pay their bills. The bureau assembles this information, along with public record information obtained from courthouses around the country, into a file on each consumer. In return, credit grantors can obtain credit reports about consumers who wish to open accounts with them.

Credit Bureau Facts
There are over 1000 local and regional credit bureaus throughout the United States. Most credit bureaus are either owned or under contract with one of the nation's three major credit reporting agencies. These national agencies maintain centralized databases containing the credit records of more than 170 million Americans. Credit bureaus generate over a half-billion credit reports a year to make credit buying faster, easier, and safer for qualified consumers.  

Credit Bureau Myths
Credit bureaus do not rate your credit. Each credit grantor or lender has different requirements for the extension of credit, so it is impossible for anyone to create an overall rating. Credit bureaus do not approve or reject consumer applications for credit; they merely report the information provided by the credit grantors.

What types of credit reports are there?
There are two types of credit reports: a consumer version and a business version.

Consumer Version
A consumer version of a credit report lists all inquiries, including promotional inquiries and account management inquiries. Only the consumer can access this version of their credit report. Creditors do not have access to this version.  

Business Version
A business version of a credit report is an abbreviated version of the consumer version. The business version does not contain promotional inquiries or account management inquiries.

What types of inquiries are there?
Inquiries on your record that do not appear on the business version of your credit report are promotional inquiries or account management inquiries. Both promotional and account management inquiries are not counted as official inquiries.

Promotional Inquiries
Vendors query our database based on a set of parameters and receive mailing-address information for individuals matching their criteria. These vendors are not viewing your report. They just want to give people who meet their parameters a firm offer of credit or insurance.  

Account Management Inquiries
Credit grantors who have permission to review the credit report of their accountholders may do so on a periodic basis. These are not counted as official inquiries.