Which credit report should I request?

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Which credit report should you request before applying for a loan? Lenders may not use just one credit reporting agency when obtaining information about you, so you shouldn’t limit yourself. It’s best to check your credit with the three major credit reporting agencies, especially because you’re entitled to receive free credit reports every year.  

This guide reviews the different credit bureaus, what they include on your credit report, and how to access yours. 

Are the credit bureaus all the same?

No, they are not all the same. Each is independent with a slightly different commercial focus. For example, one may focus on reporting business credit data while another monitors foreign creditors.

For the purposes of most American consumers, though, the bureaus are somewhat interchangeable. Federal law requires all three to work together, particularly on issues of identity theft, as well as the obligation to issue annual credit reports at no cost to the consumer through AnnualCreditReport.com.

When it comes to credit reporting, all three major bureau reports have value and none is measurably “better” than another. They all strive to maintain accurate data, but they service so many millions of consumers that personalized customer handling is virtually unattainable.

Each bureau has its own method for gathering and presenting your credit data. Also, while major creditors typically report your accounts to all three bureaus, some creditors report only to one. That explains slight variations in the information on your credit reports. Furthermore, each bureau employs its own method for computing your credit score. Consequently, scores on any given day are likely to vary.

The three major credit reporting bureaus

There are numerous credit reporting agencies with purposes ranging from qualifying people for employment to screening tenants prior to moving in. The reason Equifax®, Experian® and TransUnion® are called the three major credit reporting agencies is that they report credit information to lenders considering whether to approve someone for a loan.  

Other credit reporting agencies may collect information about you that landlords, employers and other organizations may use to make important decisions. For example, the information a landlord receives from a tenant screening company may have more weight than your FICO® score.  

If you’re looking to get approved for a new credit card, auto loan or mortgage, your prospective lender will likely check your credit with one or more of the three major bureaus.  

Equifax 

Equifax is a multinational credit monitoring company with headquarters in Atlanta, GA. It’s the dominant credit reporting agency in the southern United States and competes with TransUnion for dominance in the Midwest. 

Experian 

Experian is the largest credit reporting agency on the planet, with a presence in 43 countries internationally. Its United States headquarters is in California, and the company originally served businesses on the West Coast.   

TransUnion 

TransUnion was founded in Chicago. It’s the smallest of the major credit bureau but also serves countries like the United Kingdom, Canada, India and Brazil. In the U.S., TransUnion is most popular in the Midwest and East Coast.  

What is on a credit report? 

Credit reports contain information about open accounts you have with lenders, such as auto loans, mortgages and credit cards. Your credit report also has public records that could indicate whether you’re a credit risk. The information on your credit report may include: 

• Your name, date of birth, Social Security information, employer and address history 
• How many open accounts you have with lenders 
• Your total outstanding debt and monthly payments 
• How much of your total available credit you’ve used 
• How frequently you apply for credit 
• Whether you’ve missed or made late payments in the last 7 years 
• If you have accounts in collections 
• If you’ve filed for bankruptcy 

All this data is used to create a credit score for you. The score is a simple figure representing your creditworthiness for lenders. There are multiple credit-scoring models, but most rate you on a score between 300 and 850. 

Why are credit scores and credit reports different from bureau to bureau?  

Lenders may use one of multiple credit-scoring formulas to make credit decisions. When you apply for a new loan, you don’t know what score the lender will use. The most popular ones now are FICO and VantageScore. Your score will vary depending on which model the lender chooses.  

When a scoring system uses information gathered from the major reporting agencies, there are several reasons for discrepancies: 

• The lender may only use information from one or two of the agencies and not all three. 
• Different scores could be due to different scoring models, or credit reporting agencies may use different versions of scoring models.
• Your past and current lenders might not be reporting data to all three agencies, omitting important payment history information that could hurt or improve your score.
• Some of the information may not be updated yet because the credit agency hasn’t received or processed it.
• Some information included in your credit score may be inaccurate. 

Credit report differences

Your three credit reports differ in one important way: inquiries. This difference could work in your favor. Here’s how.

Creditors check your credit when you apply to buy something. This is called a hard inquiry. Hard inquiries often cause your score to dip slightly, and too many inquiries will cause some creditors to reject your application. Since many creditors only do business with one of the bureaus, only that credit report will reflect the inquiry.

Here’s a hypothetical. In a given month Joe applies for new credit with T-Mobile, American Express, his local electric utility and IKEA; the following month, he applies for a Barclaycard, nervous because he heard a rumor that they’ll turn him down if his file shows more than three inquiries in the past six months.

Lo and behold, when they check his credit, his file shows zero inquiries. Could this happen? Yes, if the first four creditors registered inquiries with Equifax and Experian while Barclaycard checked only his TransUnion file.

(Note: while it’s true that the bureaus do not share inquiry data, this example is for illustration purposes only. All of these variables can change depending on the consumer’s location and the creditor’s current business policy.)

Other than that, the main differences between credit reports are cosmetic. Some of the variations might appeal to you from a usability standpoint.

An Equifax consumer credit report starts with a handy summary of open and closed accounts, and then groups the accounts accordingly. Experian and TransUnion jump right into account details, listing them in alphabetical order. Experian shows the date when an account is scheduled to be removed from your report. TransUnion reportedly has more complete employment data on its credit reports.

How do I know which credit report is best to request? 

The information on all three of your reports is important, but one report may become more important than the others if it contains inaccurate information. If a lender only checks your report with that agency, you may be turned down for a loan or pay a higher interest rate. For example, if you’ve made all your payments on time with your credit card company, but it’s only reporting your payment history to Equifax, your TransUnion and Experian scores might be lower.

Another potential problem is if one credit agency is reporting a derogatory mark that shouldn’t be there. Lenders use this information to determine whether you qualify for a loan, so you might get rejected due to an inaccuracy.  

Which credit report is most important?

Under most circumstances, no credit report is more important than any other. A few exceptions apply.

Like noted above, if a lender pulls only one credit report and it happens to contain errors that affect your creditworthiness, then that credit report becomes very important because it could mean rejection.

To make sure that any credit report pulled by a lender offers the most accurate representation of your credit history, the need to regularly check and monitor all of your credit reports and correct any errors cannot be overstated. (Corrections are not passed along from one bureau to another. If you find a mistake, you must correct it on all three reports.)

If you have a positive history with a creditor who only reports to one agency, and an application for credit pending with a creditor who only does business with one of the other two, the potential new creditor could reject your application in light of the lack of data. The credit report that shows the account in good standing is more important because it could trigger application approval.

If an account does not appear on one of your credit reports, you cannot compel the creditor to share the information with that bureau, nor can you force the other bureaus to include the account. Some alternative bureaus allow consumer submissions (for a fee). Or you might be able to persuade the prospective creditor to simply purchase the credit report that shows more positive history.

Mortgage lenders view data from all three bureaus in a special, merged report. So if you plan to purchase a house, know that all three reports are equally important.

Which credit score is most important?

None of the bureaus can claim to offer the most accurate credit score, assuming credit report errors have all been corrected. Consumers can actually have dozens of different credit scores, and each one is as accurate as any of the others.

Variation between the scores exists for different reasons (including the fact that each report may contain slightly different data). Credit scores also differ depending on who requests it.

An auto lender sees one score while a credit card issuer sees another. Some lenders simply pull all three and use the middle number to determine eligibility. VantageScore, developed by the three major bureaus, purports to deliver more accurate scores than FICO, but FICO is still the credit score used by most major creditors.

How to access your credit reports 

All three major credit bureaus offer credit monitoring services. You may need to pay a monthly fee if you want to receive credit alerts or check your credit score on demand. All consumers have the right to receive a free credit report from all three bureaus.

The easiest way to get your report is to visit AnnualCreditReport.com. You could get all three reports once per year or stagger them throughout the year. Staggering them can help you detect inaccuracies or identity theft a lot faster.  

How to improve your credit 

Improving your credit before applying for a loan could save you thousands of dollars in interest. Some of the ways you can improve your credit include: 

• Dispute unfair or incorrect information on your credit

• Keep your credit utilization below 30 percent. Credit utilization is the portion of your total available credit you’re using, such as on a credit card.  
• Pay all your bills on time.  
• Only apply for credit when you need it, so you don’t have as many hard inquiries on your credit report. 
• Check your credit score and look for any inaccuracies. 
• Dispute unfair or incorrect information on your credit report with each of the major credit reporting agencies.  
• Having a good mix of credit types, including personal loans, credit cards, auto loans and mortgages.

It can take time to see significant changes, so be patient. Even if the negative information on your report is accurate, it has less of an impact on your score over time.   

Disputing inaccurate information

Many people who have negative information on their credit reports can improve their credit by disputing inaccuracies. There isn’t one best credit report you should request because the information on all three reports is important.

Obtain copies of yours each year so you know what steps to take next. Pulling your own credit report won’t impact your credit. You can also get a free credit evaluation and recommendations for improving your credit at CreditRepair.com.

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Note: The information provided on CreditRepair.com does not, and is not intended to, act as legal, financial or credit advice; instead, it is for general informational purposes only.

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