Everything to Know About Experian Credit Bureau

To apply for a mortgage, credit card, or other types of financing, you need a credit score. There are three major credit bureaus in the U.S., Experian, TransUnion, and Equifax. Each credit reporting agency is individually owned and operated; they are not linked in any legal way. Because of this, they often show different data in their reports. The FTC is the government agency that oversees credit bureaus and enforces the Fair Credit Reporting Act. 

Creditors call upon credit bureaus to provide them with credit reports and credit scores before deciding whether or not to lend you money or extend you any credit.  

The History of Experian Credit Bureau 

Experian is considered the largest of the three credit bureaus, managing data for more than 890 million people and 103 million businesses worldwide. 

A British company, GUS plc., created Experian when they merged TRW Information Systems & Services and the CCN Group in 1996. At that time, TRW was the largest credit bureau in America and managed most U.S. citizens’ credit reports. That company also provided business clients with marketing, analytical, and real estate data services. 

In 2006, Experian was split off as its own entity. In 2001, Experian acquired and absorbed Serasa, the fourth largest credit bureau in the world. That move bolstered their standing and moved them up the ladder to first place among credit reporting agencies. 

Experian is now the top credit reporting agency in the world, with a staff of 16,500 employees in 39 countries. Originally its focus was on retail businesses and financial services but now supports all areas of industry, including healthcare, automotive, telecommunications, and even government. It is headquartered in Dublin, Ireland. Experian won the U.K. Business of the Year award in 2003 and 2005. Forbes Magazine has named Experian the “World’s Most Innovative Companies,” for five years running. Experian trades on the London Stock Exchange with the call tag (EXPN).

What is Experian Credit Bureau?

Experian describes their business as “During life’s big moments – from buying a home or a car, to sending a child to college, to growing a business by connecting with new customers – we empower consumers and our clients to manage their data with confidence. We help individuals to take financial control and access financial services, businesses to make smarter decisions and thrive, lenders to lend more responsibly, and organisations to prevent identity fraud and crime.”

Experian is a credit reporting agency. They gather data on millions of people worldwide and collate it and then run algorithms on it to come up with a 3-digit number. That number is your credit score. Sometimes they pay for the data, and sometimes it is provided freely by government sources or other third-party vendors. 

Lenders, creditors, and other financing institutions pay Experian for the privilege of ordering credit reports on anyone who applies for credit with them. These credit reports show, among other things, your creditworthiness and risk factor. A typical credit report will also show:

• Name and home address, including many of your previous addresses.

• Social security number.

• Your birthdate.

• All your credit card information including credit limits, credit card vendors, your payment history, and any collection activity if you haven’t paid your bills.

• Loans you have taken out with banks or other financial institutions. Loan data may include the original loan amount, the terms of the loan, the remaining balance, and how well you paid every month. Both mortgages and personal loans will show up on your credit report. 

• Any bankruptcies and foreclosures.

• Student loans, and the remaining balances.

• Car loans and the interest rate, plus who lent you the money.

• How well you paid all your bills, any missed or late payments.

How Long Does Information Stay on My Experian Credit Report?

How long information stays on your credit report depends on its impact to your score. That’s because credit offerings (car vs. home) consider different factors, and specific details are needed longer. For example:

• Credit inquiries (requests to review your file) are listed for two years. However, these are relatively low impact, and their effects wane quickly. 
• Late payments and collection accounts are recorded for seven years. These cases are heavily weighted when calculating your credit score.
• Personal bankruptcy filings can be seen for ten years.

The Fair Credit Reporting Act (FCRA) was established to ensure the accuracy, security, and consistency of private credit information by reporting agencies. If you’re curious about precisely how long a black mark stays on record, the FCRA gives a comprehensive list.

It’s not just the three major credit reporting agencies that must follow the FCRA. Other entities like private investigators, collections, insurance companies, and banks are also beholden to it.

How Can Experian Protect My Information?

Credit reporting agencies receive a staggering amount of personal information. If they lose your data, you’re almost assured to have part or all of your identity compromised. This situation occurred when Equifax leaked the private details of nearly 150 million people.

Experian offers a credit lock service to ensure your information stays secure. This option lets you temporarily deny access to your credit report and can be undone through their website or mobile app. While it comes with a steep price of $20/month, a credit lock is worth considering if you believe your information is in danger.

Remember that a credit lock prevents other institutions like banks and housing offices from accessing your report even with your permission. If you’re applying for a loan or agreeing to a background check, you must disable the lock first.

What Does Experian Do?

Along with keeping track of your financial state, Experian offers dozens of services to both consumers and businesses. They take credit reporting to a whole new level and are committed to helping people improve their financial standing through products, services, and education.

Consumer Products/Services

Every person is eligible for a free copy of their Experian credit report in a 12-month period. You can order one easily through annualcreditreport.com. Along with that, you can purchase other services such as:

• Identity theft protection and credit assistance.
• Fraud protection.
• Credit locking where you can lock/unlock your credit with a mobile app.
• They also offer credit cards for people with bad credit, no credit, and students to help them build a better credit profile.
• Fraud alerts.
• Credit freezes.
• Disputes.

They also have an extensive section on their website to help educate consumers about cybersecurity, fraud protection, improving credit scores, data breaches, and personal finance assistance.

Business Products/Services

Experian also offers diverse services for small and large businesses. Some of what they provide is:

• Business acquisition assistance.
• Small business credit.
• Marketing insights.
• Debt collection.
• General small business advice.
• Customer management.
• Risk management.
• Debt recovery.
• Fraud management services.
• Regulatory compliance.
• Consulting services.
• Thought leadership.

They also provide a lot of free resources on their website for businesses who want to know more. 

Are Credit Scores the Same in All Countries?

Travel both inside and outside the US is returning with a vengeance. However, people seeking to relocate permanently must do some research before setting new roots.

Along with adopting a new currency, ex-pats must adjust to a different credit system. The three major credit reporting agencies in the US don’t dominate the globe. In fact, outside of the US and Canada, these agencies rarely offer concrete scores at all.

Each country scores its citizens differently. For example, Australia has four major credit bureaus, and the Netherlands has only one. Your credit score in the US won’t transfer directly, and you’ll need to work hard to cultivate a new financial reputation. This circumstance is called being “credit invisible.”

First-generation immigrants understand that starting a new life with no credit is rough. Getting business loans, buying a car, or even renting an apartment is difficult. Anyone wanting to relocate should consider a country where a familiar agency like Experian is semi-active. These countries include:

• United States
• Canada
• Bulgaria
• Germany
• Australia
• Czech Republic
• Greece
• Poland
• Romania

There are even some countries that use “negative reporting.” These countries place black marks on people who neglect payments, similar to a school system’s permanent record. Rather than a specific number score, negative reporting shows the number of times an individual was irresponsible.

Don’t worry too much, though. Despite the differences, the foundation of credit is relatively unchanged in every country. The key to good credit is to control your debt, make timely payments, and restrict yourself to just a few accounts.

Why Are My Credit Scores Different?

Contrary to popular belief, people don’t have just one credit score. Life and money are rarely that convenient. No, you’re expected to keep track of a collection of numbers all used for different purposes. This makes it challenging to know if you meet the acceptable credit score for whatever you’re applying for.

Factors like utilization rate, history, hard inquiries, and payment history are generally considered in every calculation. However, the weight assigned to each element will vary based on the specific version an inquiry requests.

Scoring Model

There are standard scoring models that major agencies use depending on the situation. For example, the FICO® Score 8 and VantageScore 3.0 are base scores determining your likelihood of following through on a repayment plan.

There are also industry-based scores used for specific loans. A different model for a house compared to a car.

Credit Bureau

Your score will also change depending on which credit bureau you’re checking with. We detail precisely how Experian calculates your score later in this article, but know that you’ll never get the same score from all three. This is because they’re independent agencies and don’t share information with each other.

Experian might get a report of your latest missed payment before Equifax or TransUnion. Knowing the newest information will cause Experian to lower your credit score before others get the chance. There’s also the chance that a lender didn’t report the same information to all three bureaus.

Access Date

Your score can change at the drop of a hat. Checking different scores on different days will cause discrepancies if new information comes in.

Keeping good credit habits not only keeps your general scores high but also keeps them stable. You have more control over the number lenders see and can ensure the number doesn’t take an unexpected dive.

Reported Errors and Cybercrime

The people reporting to credit bureaus are only human. They make mistakes, too. Errors can seriously damage your credit score and are a significant reason why you should request a copy of your report at least once a year.

Additionally, if you’ve experienced identity theft, the criminal may have racked up a sizeable outstanding debt in your name. If the bureaus don’t know the mistake, it’ll also reflect in your score.

How Does Experian Calculate My Credit Score?

According to Experian, a “Credit score is calculated based on FICO® Score 8 model, unless otherwise noted. In addition to the FICO® Score 8, we may offer and provide other base or industry-specific FICO® Scores (such as FICO® Auto Scores and FICO® Bankcard Scores).”

Experian uses credit scores between 300 and 850. Seven hundred is considered a good score, and anything over 800 is excellent. When discussing a FICO® score, anything 670 and above is okay for obtaining a mortgage.

A few things factor into your credit score. The most impactful one (35% of your score) is based on your payment history and how well you pay your bills. It is a good indicator of your risk value and very important to potential creditors.

How much of your available credit you are using is another significant factor (30% of your score). Credit reporting agencies like to see a diverse mix of credit types (car loan, mortgage, credit cards, etc.), and that plays into your score as well.

If you have a lot of hard inquiries (meaning you applied for credit of some type), this can negatively impact your credit score. Obviously, any foreclosures, bankruptcies, and late or missed payments will also bring your score way down. 

Even if you have bad credit, you can sometimes still apply for a mortgage and get approved. Experian has dozens of resources for people who want to improve their financial lives. You can contact Experian here