What is a consumer reporting agency, and how did agencies of this nature come to have such an influence over your life? These days, whether you’re requesting a mortgage loan, buying a car, getting a credit card, applying for insurance or even applying for a job, someone will look at the consumer credit reports supplied by a major credit reporting agency before making a decision about you.
At ScoreSense, you have the opportunity to monitor what is being reported about you on an ongoing basis. Rather than getting a free annual credit report from a major consumer reporting agency once a year, you can check the reports from all three – Experian, TransUnion and Equifax – anytime you want.
For the most part, the birth of the consumer reporting agency occurred after World War II, when large numbers of families were buying homes, cars and appliances on credit. Local merchants formed bureaus to share information primarily on who failed to pay. Often, these bureaus would search local papers for information on marriages, promotions, bankruptcies, and deaths, which would be clipped and added to a consumer’s file.
By the late 1960s and early ’70s, computers began to change the ways a credit reporting agency did business. Paper files were no longer kept in rows of file cabinets and read over the phone to inquirers. A smaller consumer reporting agency that was unable to afford the new technology sold its files and went out of business. As a result, smaller local bureaus became regional bureaus and eventually national and international agencies.
Passage of the Fair Credit Reporting Act (FCRA) in the 1970s also changed the landscape. Regulations on what information could be collected and who could see it, as well as the right of consumers to receive copies of the information gathered on them helped speed consolidation of the consumer reporting agency industry.
With easier access to accurate information on more people, the usefulness of consumer credit reports grew. As a result, the demand for the services of a consumer reporting agency grew. We have become a society largely dependent on credit, and knowing how well someone handles their financial responsibilities can be a key element in decisions made about him or her.
From small, local bureaus organized for local merchants to large, multinational agencies dealing in information exchange and analysis on consumers, the consumer reporting agency has come a long way. It appears it will have a long future as a major player in our financial system.
What is a consumer reporting agency telling others about you? Learn more about credit and credit reports by visiting scoresense.com today.