As credit increased thoughout the country, there arose a great need to issue reports concerning those who are not a good credit risk as well as those who are of credit worthiness.

Because of this great need, credit reporting agencies were formed several years ago. These agencies, known as credit bureaus, receive information about consumers (such as you) from banks, loan companies, credit card compnies, department stores and other credit issuing sources. Credit bureaus earn their profits by giving a computer readout showing a financial profile and credit history of any individual. These reports are requested by a lender or any credit issuing firm from which you or any individual have requested credit.

Most lenders will base their acceptance or rejection of your credit application on the information on your credit report. If your credit report shows that you have been reliable in the past, then in most cases credit is granted. The amount being a determining factor also. However, what if your report reveals that you have had some credit problems in the past? Perhaps you have encountered circumstances beyond your control which made it impossible to meet your personal credit obligation. It happens.

What if your credit report shows that you've defaulted on a particular credit account or you were constantly late with your monthly payments? Or you have co-signed for a 'friend' or relative that leaves you holding the bag. This of course can be most embarrassing but worst, usually leads to credit denial.

There are approximately 2500 credit reporting agencies in the U.S. These agencies sell information about you to banks, department stores, credit card companies, loan companies, etc.

These credit bureaus keep on file information concerning you and your credit but they do not make the final judgment on your credit worthiness. The decision is up to the lender which you have dealt with, to decide who to issue credit. The decision is usually based on information in your report.

You have a right to know what is in your credit report. It is your personal credit file, you should know what information the credit bureau is giving out concerning your name and your credit. If the information is adverse, outdated, or incorrect, it can be changed. For the better.