Not everyone can report debt to the credit bureaus. The credit bureaus must approve the company in question and the company must purchase and update special software that is capable of processing reports on consumer accounts. Debts cannot be reported manually.
The Credit Bureaus’ Reporting Program
The first step for a company that wishes to be able to submit regular payment reports to the credit bureaus for insertion into the credit files of its customers is to file an application. The application process requires the company to submit documentation of the company’s legitimacy and business practices. Financial information on the company may also be requested.
If the application is approved, the credit bureau in question will send a representative to evaluate the business location to ensure that it physically exists. The flat fee for the inspection is approximately $75-$100, depending on the credit bureau.
If the credit bureau is satisfied that the business is legitimate, once the fee is paid the applying company will be issued a membership ID number. This number is used when making reports to identify the company.
Credit Reporting Software
Businesses that have been issued a membership ID number must purchase and install the appropriate credit bureau approved software. The credit reporting software that is recommended by the credit bureaus changes periodically. When changes in software is recommended, members will be notified of the changes.
The current approved industry software is Credit Time 2000. Credit Time 2000 does not require members to pay a monthly fee, but it is very expensive to purchase and requires frequent paid updates.
In addition to credit reporting software, businesses must also purchase dispute software. The recommended dispute software compatible with Credit Time 2000 is e-Oscar. Dispute software monitors consumer credit files and notifies the company in the event that any of the accounts it reports are disputed by consumers. The software also serves to supply consumers and credit bureaus with automated dispute verifications.
It must be noted, however, that automated dispute verifications may not stand up in a court of law.
Companies Do Not Have to Report to All Three Credit Bureaus
One of the main reasons that credit scores vary depending on the credit bureau reporting them is that not all companies will either choose to report to all three credit bureaus or be approved to do so.
Being approved for membership in one credit bureau’s credit reporting program means that the business in question has permission to report to that particular credit bureau. A company must be approved with all three credit bureaus in order to appear on all three of an individual’s credit reports. A membership ID number is only valid for the credit bureau that provides it.