What Is a Credit Reporting Agency, and What Do They Do?

One wrong item on your credit report can mean the difference between getting approved or denied for a loan. And it happens more often than you’d think—about 1 in 5 Americans has at least one mistake on their report.

Credit reporting agencies collect and share the information that lenders use to make those decisions. Knowing what they track, how they operate, and how to fix errors can help you avoid surprises and stay in control of your credit. You’ll also learn how to check your credit reports, understand what’s in them, and take action if something doesn’t look right.

What are credit reporting agencies?

Credit reporting agencies are companies that collect, organize, and share credit information about individuals and businesses. Lenders, credit card companies, landlords, and even some utility providers use this data to decide whether to approve you for credit, how much to lend, and what interest rate to offer.

In the U.S., the credit reporting industry is dominated by three main players: Equifax, Experian, and TransUnion. Each of these agencies operates independently and may receive different information from different sources, which is why your credit reports and scores can vary from one credit bureau to another.

The credit reporting system didn’t always look like this. It started out as a network of small local offices that manually gathered personal and financial details about borrowers. These credit reports often included irrelevant or biased information like a person’s age, marital status, or even race and religion.

Over time, the system became more standardized and regulated, eventually forming into the three nationwide agencies we have today.

How do credit reporting agencies work?

Credit reporting agencies receive monthly updates from banks, credit card companies, lenders, and some service providers. These updates include your account balances, payment history, credit limits, and whether you’ve made payments on time or missed them. They take that data and use it to update your credit file, which becomes the basis for your credit reports and credit scores.

The information doesn’t update in real-time. It can take a few weeks for new activity—like a payment or a new account—to appear on your credit report. That’s why it’s normal to see a lag between what you’ve done and what’s reflected in your credit file.

Do all lenders report to credit bureaus?

No, reporting is completely voluntary. Most large lenders and credit card companies report to all three credit bureaus, but smaller lenders or local credit unions might report to only one—or not at all. Some creditors also report only negative information, like missed payments, and skip over your on-time payments entirely.

Before opening a new account, especially if you’re working to build or rebuild credit, ask the lender which credit bureaus they report to. This can help you make sure your good habits are helping all three of your credit scores grow.

What Credit Bureaus Track

Credit bureaus collect a wide range of financial data that paints a picture of how you handle money. This includes:

• Payment history: Whether you’ve paid your credit cards, loans, or other bills on time. Late payments can show up after 30 days and may keep getting reported in 30-day increments until paid.
• Current balances and credit limits: How much you owe and how much credit you have available.
• Account types and statuses: Open and closed accounts, credit cards, auto loans, mortgages, and personal loans.
• Credit inquiries: Who’s looked at your credit—either because you applied for credit (a hard inquiry) or checked your own credit report (a soft inquiry).
• Public records: This can include bankruptcies, foreclosures, tax liens, court judgments, charge-offs, repossessions, and accounts sent to collections. Most of these items stay on your credit report for seven to ten years.

Not all creditors report every detail to every credit bureau, but anything that does get reported can affect your credit profile. That’s why it’s important to regularly review your credit reports from all three agencies—not just one.

How It Affects Your Credit Score

Everything credit bureaus track can impact your credit score, for better or worse. Lenders use that score to decide whether to approve you for credit, how much you can borrow, and what interest rate you’ll pay.

The biggest factor in your credit score is your payment history. Just one late payment—especially if it’s more than 30 days past due—can drag your score down. And if it goes unpaid, it can keep hurting your credit every month until it’s resolved.

Other negative marks, like charge-offs, repossessions, and collections, also lower your score and can make lenders see you as a higher-risk borrower. Even if you do get approved, it may come with a higher interest rate or a lower credit limit.

On the flip side, on-time payments, low credit card balances, and a mix of credit types can help boost your score. That’s why it’s worth checking your credit reports regularly to make sure everything being reported is accurate—and working in your favor.

How to Dispute Credit Report Errors

Credit report errors can lower your credit score and make it harder to qualify for loans. Check your credit reports from Equifax, Experian, and TransUnion regularly to catch errors early.

You can get a free credit report from each credit bureau every 12 months at AnnualCreditReport.com. Extra reports are available if you’ve been denied credit in the past 60 days, are unemployed and job-hunting, receive public aid, or have a fraud alert on file.

Look for inaccurate balances, unfamiliar accounts, or incorrect payment dates. If you find something wrong, dispute it directly with the bureau online, by mail, or by phone.

Bureaus must investigate within 30 days. If the data can’t be verified, it must be corrected or removed. Always follow up to make sure the change is reflected.

If you prefer help, a reputable credit repair company can handle disputes on your behalf. They work with creditors and bureaus to remove inaccurate or outdated items. See our list of top-rated credit repair companies for trusted options.

Who Regulates Credit Reporting Agencies?

Credit reporting agencies aren’t government-run, but they are regulated at the federal and state level to help protect consumers.

The Consumer Financial Protection Bureau (CFPB) oversees how the major credit bureaus handle disputes, respond to consumer complaints, and maintain accurate data. The Federal Trade Commission (FTC) also enforces credit reporting laws, especially around fraud and deceptive practices. At the state level, your attorney general’s office can help with problems specific to your state.

If you’re having trouble with a credit bureau, you can file a complaint with any of these agencies. Start with the CFPB, and consider contacting the FTC or your state AG if you don’t get results.

Your Rights Under the FCRA

The Fair Credit Reporting Act (FCRA) gives you specific rights when it comes to your credit information. Here are some of the most important ones:

• You have the right to see your credit reports for free once every 12 months from each credit bureau.
• You have the right to dispute errors, and the credit bureau must investigate within 30 days.
• You can opt out of prescreened credit and insurance offers by calling 1-888-5-OPT-OUT or visiting optoutprescreen.com.
• You must be notified if a company denies you credit, insurance, or employment based on your credit report, and you’re entitled to a free report in those cases.

Knowing your rights makes it easier to catch problems early—and take action before they hurt your credit score.

When to Consider Professional Help

If you’re dealing with multiple errors across several reports, or if past disputes haven’t been resolved, working with a credit repair company can help speed things up.

A good credit repair service will contact the credit bureaus on your behalf, submit disputes, and follow up until the issue is fixed. Just make sure the company is transparent about fees and doesn’t promise results it can’t deliver. Avoid any service that asks for upfront payment or guarantees a specific credit score.

If you’re not sure where to start, take a look at our list of top-rated credit repair companies to find a service you can trust.

Contacting the Major Credit Bureaus

Need to request your credit report, file a dispute, or place a fraud alert? You’ll need to reach out directly to each credit bureau.

For up-to-date phone numbers, mailing addresses, and online dispute portals, visit our credit bureau contact directory. It has everything you need to get in touch with Equifax, Experian, and TransUnion in one place.

Final Thoughts

Credit reporting agencies have a major influence on your financial life, whether you’re applying for a credit card, getting a car loan, or renting an apartment. Staying on top of your credit reports—and correcting any errors you find—can save you money, improve your approval odds, and help you qualify for better rates.

Even small steps, like disputing one mistake or setting up payment reminders, can make a big difference over time. The more you know about how credit reporting works, the more control you’ll have over your financial future.