There are three major credit bureaus: Equifax, Trans Union, and Experian. Together, these three bureaus compile and maintain credit files on nearly 90 percent of adults in the United States. A common public misperception is that these bureaus are government agencies or extensions of the federal government, while, in fact, they are private, for-profit companies that gather information about your credit history and sell it to businesses that are legally permitted to see your report. The businesses allowed to request your credit report include creditors such as banks and credit unions, credit card companies, mortgage lenders, and retail stores, in addition to employers, landlords, and insurance companies.

Credit bureaus compile the majority of your credit information from the creditors. The bureaus also search court records for lawsuits, judgments, and bankruptcy filings. And they go through county records to find recorded liens (legal claims).

To create a file for an individual, a credit bureau searches its database and finds entries that match the person's name, Social Security number or other identifying information. The subsequent matches are compiled to complete the report.

Credit reports also include noncredit information such as previous and/or maiden names, Social Security number, past and present addresses, employment history, marriages, and divorces. Many credit report mistakes are noncredit items, and can sometimes cause a great deal of confusion and frustration. John Thomas Doe of Stockton, CA, may have a credit report that shows a payment delinquency 		on a 2004 Baja H2X Powerboat, while J. T. Doe of Phoenix, AZ is waterskiing at Lake Havasu, wondering why he hasn't received his payment coupon book from the bank. It's not uncommon for creditors to mistake identities and demand payments from the wrong party, so make sure your noncredit data is accurate.

Credit data also includes information about your creditors, the type and number of each account, when the account was opened, your payment history, your amount of the loan, current credit limit, and your existing balance. The report will show if an account has been sent to a collection agency or is in dispute.

Unfortunately, an alarming number of these files (credit reports) contain serious errors and could cause the denial of credit, a loan, or a job, so monitor your credit report and minimize or eliminate future credit problems. Remember, keeping a 'clean' credit report is essential to your financial well-being.