Credit reporting agency used by your bank – this is why

One of the most important things to know when you apply for a credit card is the credit bureau used by the bank to draw your credit report.

Your credit report is a detailed record of your credit history that can determine if you are approved for a new credit line, such as a credit card.

In the US, there is three major credit bureau – Also known as a Credit Reporting Agency – that banks and credit card companies can pay to access your credit reports: Equifax, Experian and Transunion.

Related: How to check your credit score for free

The Credit Reporting Agency (CRA) used by the card publisher to view your credit report can determine whether your application is approved or rejected, especially when you apply for various cards in no time. If some card issuers are attractive from the same credit reporting agency, it may affect you Opportunities to be approved.

However, if the card publisher goes to a different credit bureau to buy your report, one publisher may not see that you are applying for a new account elsewhere. As a result, your chances of being approved for some cards need to increase.

Multiple credit applications can reduce your scores, so it’s important to know what you are in before you decide to apply for some cards at once.

Before you apply for a new credit line

Knowing where your credit is standing before applying for any kind of new credit is critical. Be sure to check your credit scores and reports before you fill out a new application.

Check your credit report

Your credit report is a record of your credit activity, including your payment history, outstanding debt and credit query. Understanding your credit health gives you a better idea of ​​how your application can look to potential credit card publishers. Fortunately, checking your three credit reports is easy.

You can request a free report from Equifax, Transunion and Experian once every 12 months online at YearCreditReport.com.

Related: How to correct the error on your credit report

Check your credit score

While your credit report draws a detailed picture of your credit history, it usually does not include your current credit score, so you want to check it too.

Checking you credit scoreHowever, it can be more complex. Of just three scores – one for each of your credit reports – there are hundreds of commercial credit scores, and some borrowers also use their own custom model. This means that there are thousands of possible credit score variations.

The two most widely used credit score models in the US are Fico and Vantagescore. Vantagescore, created by three major credit bureau, has gained popularity since its launch in 2006.

However, FICO remains an industrial standard, with 90% of borrowers relying on it for credit decisions. Many banks offer free FICO scores to cardholders as useful camping.

What is the fico score?

Your FICO score is a number between 300 and 850 based on the information in your credit report.

FICO scores are calculated using a lot of different credit data in your credit report. This data is grouped into five categories: payment history (35%), total debt (30%), credit history length (15%), new credit (10%) and credit mix (10%).

Lenders use this score to evaluate your credit eligibility – the higher your score, the better your chance to get approved for credit cards and other loans.

According to FICO, the “good” credit score fell between 670 and 739, while the 740-799 score was considered “very good” and 800+ considered “unusual.” However, Pursuing a perfect 850 score is not necessary. In most cases, credit card issuers do not distinguish between the above 720 scores, so strong scores in this range are usually enough to secure the best deals.

Which credit bureau is checked by the bank – and why important?

When you apply a credit cardPublisher contacted the Credit Bureau (or several) to purchase a copy of your credit report. Included in your report are the five categories mentioned above.

Related: What is a good credit score?

You will see a category of credit reports, which calculates 10% of your score, called “new credit.” If you have too many credit applications open in no time, it can affect your credit score negative.

Imagine the following scenarios: you have filled out several applications for new credit (loan or credit card) in the last 12 months. This app appears on your credit report as a “hard question” and has the potential to damage your credit score.

You then decide for Apply for another new credit card. In addition to your potential to take a hit, you may experience another road block.

The bank processing your application may be concerned about why you apply for a new credit in no time. As a result, it is possible that you can be deducted for credit cards even if your credit score is in good condition.

Knowing that a credit reporting agency card publisher used to attract reports may help you avoid this problem. With this knowledge in hand, you can take your time (or writ it, as applicable) in such a way that you increase the likelihood of your approval for your desired credit card.

Related: 5 things to check before applying for the next credit card

Many credit card companies tend to rely on one bureau when they process credit card applications. The credit bureau they use to buy a report, however, may vary depending on the situation you left and the specific credit card you want.

Here are the Credit Bureau commonly used by three popular publishers:

• Citi uses the third -three credit bureau, but usually attracts credit reports from Equifax or Experians.
• The American Express uses the third -three credit bureau but mainly attracts reports from the experians, though sometimes equifax or transunion as well.
• Chase uses the third -three credit bureau but experienced, but can also buy Equifax or Transunion reports.

However, keep in mind that you cannot know exactly which credit bureau will be used by credit card companies.

Bottom Line

Your credit report is a major part of your financial profile that can have a significant impact on your credit trust. By understanding the credit reporting agency used by the bank to review your credit, you may be able to increase the likelihood of approval Your next credit card application.

Related: 4 myths of ordinary credit score