ECON Lowdown Credit Bureaus: The Record Keepers

Credit bureaus

can be beneficial to consumers who are financially responsible and need credit to make large purchases.

Negative information included in credit reports

can be removed after 7 years.

FICO scores indicate the financial responsibility and behavior of consumers. It is important for lenders to review a consumer's FICO credit score because

consumers with lower credit scores are more likely to not pay on time and possibly make no payments at all.

Lenders provide information to

credit bureaus because it is in their best interest to have complete and accurate records.

Credit scores are

designed to indicate the risk that a person will repay a loan or credit obligation on time.

Most of the information collected by the Big Three credit bureaus comes from

general credit cards and other sources.

Credit bureaus

make a profit by selling information to lenders and by selling products directly to customers.

Which statement is incorrect?

Credit bureaus always charge a fee to issue a credit report.

A consumer's credit report does not include the consumer's

race, age, or gender.

Credit bureaus first emerged in the United States in the late 1800s

to help lenders lessen the risk of extending credit to consumers who did not pay their bills.