Credit Building Tips

How to Report Someone to the Credit Bureau

Shaun Connell
June 9, 2023

If you own a small business and a customer owes you money, you might be wondering whether or not you can report them to the credit bureaus. Even if you don't own a business, you might be curious to know if you have the right to report someone that owes you money to the major credit reporting agencies.

The reality is that reporting to the credit bureaus isn't something you can do in a one-off way. In fact, there really isn't any way that an individual can report to the credit agencies.

Solution iconSmall business owners that allow customers to pay for things in installments or offer lines of credit, though, can choose to apply to become data furnishers for one or more of the major credit bureaus. As data furnishers, these businesses are required to send accurate information monthly about their consumer accounts. An alternative option is hiring a debt collection agency to try and recoup the debt and report to the credit bureaus.

If you're considering starting to send customer account information to the credit bureaus, stick with us while we go over everything you need to know.

How to Report Someone to the Credit Bureau

Only officially approved data furnishers can report information to the credit bureaus about a consumer. Individuals aren't authorized to apply to be data furnishers.

Even small businesses, though, can report to the credit bureaus if they are accepted into their data furnisher programs.

How to Become a Data Furnisher

If you want to report someone to the credit bureau, you will first need to become an approved data furnisher for the credit reporting agency where you want to send your information.

transunion data furnishing to report to credit bureau

In order to become a data furnisher, you'll need to:

  1. Select the credit reporting agency or agencies that you want to report to
  2. Contact the credit bureau or bureaus that you have chosen and ask to speak to the Business Services Department
  3. Request a business reporting program application (Experian doesn't have a minimum for how many consumer accounts you will be reporting, but both TransUnion and Equifax do)
  4. Fix out and submit your application along with any other required documentation (this documentation helps to support your claim that you are a legitimate business owner and have the required number of customer accounts, if applicable)
  5. Wait to be contacted by the credit reporting agencies and schedule an appointment for an on-site inspection and pay the required fee (a representative will be sent from the credit bureau to ensure your business physically exists)
  6. Sign a service agreement or data furnisher agreement with the credit reporting agency after your application has been accepted (this is a document that outlines your agreement to regularly and accurately report on the accounts)

You can find more information about the specific requirements and application instructions for each credit bureau using the following links:

How to Report Accounts to the Credit Bureaus

Once you have been approved as a data furnisher for your selected credit bureaus, you'll want to follow the following steps to report consumer information:

  1. Buy and install the software you need to report to the credit bureaus (e-Oscar and Metro 2 are used by all of the major credit bureaus to make consumer reports and keep payment records)
  2. Use the Metro 2 program to record the personal information of your customers
  3. Every month, update the information when customers make their payments
  4. The software will file reports to the credit bureaus automatically

In order to maintain your ability to regularly report consumer information, you'll need to update the required software on a regular basis. Each credit bureau has its own standards that must be maintained in order to continue qualifying as an official data furnisher.

Here are a few additional tips for small businesses that want to report consumer information to the credit bureaus:

  • Even if you aren't accepted into the program of one credit bureau, that doesn't mean you will necessarily be turned down by another. You can apply to be a data furnisher for all three if you choose.
  • If your company doesn't have as many accounts as are required in order to become a data furnisher for a particular credit bureau, it's possible that you can apply and be accepted to report accounts to a third-party processes.
  • When you agree to be a data furnisher, you are agreeing to make monthly reports on your consumer accounts. Your membership agreement can be terminated if you fail to make these regular monthly reports.

An Alternative Option: Hire a Collection Agency

If you're not a large lender and aren't interested in becoming a data furnisher with one or more of the major credit bureaus, another option is to hire a collection agency.

Collection agencies are companies that will attempt to collect the debt that you are owed. This can be a reasonable route to take if you only have a few unpaid customer debts.

When choosing a collection agency, you'll want to consider the following:

  • Not all collection agencies will be a member of all three credit reporting agencies-- make sure that they will report to all three
  • If the collection agency violates the state and federal laws regulating debt collection, you could be held liable to the consumer.
  • Some debt collectors will take a percentage of the money they collect on your behalf, while others will buy your debts outright.
  • Debt collectors should be viewed as a last resort, as they can be expensive, and you won't recoup the full amount of the debt you're owed.

Who Can Report to Credit Bureaus?

The three major credit bureaus will not accept information from just any old consumer. If someone owes you money or has been repeatedly late in paying back a private, non-official loan, you're not going to have luck trying to add this information to their credit file.

equifax data furnishing to report to credit bureau

In order to contribute information to the credit bureaus, you have to become a data furnisher.

Businesses must apply and be accepted as data furnishers at each individual credit reporting agency (or whichever credit bureau they wish to work with) in order to report consumer information. This is not a free service and requires that businesses adhere to and abide by the Fair Credit Reporting Act and all other applicable federal laws.

However, this does mean that small businesses that allow customers to make purchases on credit or pay using installment plans can become data furnishers if they want to make monthly payment reports on their customers.

To become a data furnisher, businesses need to choose the credit bureaus they want to report to and then apply for membership in their business reporting programs. Companies that want to make reports to all three credit bureaus will need to be separately approved by each agency.

Why Would You Want to Report Someone to the Credit Bureau?

Creditors, lenders, and small business owners that offer lines of credit or installment payment plans aren't required to report to credit bureaus by law.

Even though this isn't a requirement, many businesses choose to report information about consumer accounts to the credit bureaus, such as:

  • On-time payments
  • Purchases
  • Late payments
  • Credit limits
  • Loan terms
  • Balances owed

It is with this type of information that credit reporting agencies are able to generate consumer credit reports and calculate credit scores.

Other major events will also often be reported to the credit bureaus such as charge-offs and account closures.

You might wonder why businesses and creditors would bother reporting to the credit bureaus, particularly because it is a service that costs them money. There are ultimately a number of reasons why companies might be motivated to become data furnishers, including:

  • Contributing to the centralized database of credit information: The more information that lenders and companies have about consumers, the more informed their lending and credit extension decisions could be.
  • Reciprocation: Companies and lenders benefit from the information being reported to the credit bureaus, and they can help other companies make more informed lending decisions by also sharing information.
  • Motivating customers to repay their debts: If consumers know that their late payments or other negative information about their account will impact their credit, it provides an additional motivation to pay on time and repay the entire debt according to the terms of the agreement.
  • Fraud prevention: Reporting information to the credit bureaus can help identify fraudulent activities such as credit card fraud or identity theft.

Can I Self-Report to Credit Bureaus?

Unfortunately, you are not able to directly report your own financial activity to the credit reporting agencies. Even if you have bills that you regularly pay on time that aren't showing up on your credit report, Equifax, TransUnion, and Experian won't accept information from an individual consumer in this way.

The reason for this is that you have to become a "data furnisher" in order to report information to the major credit bureaus, which is an officially recognized status.

If you own a small business that lets people pay in installments or carry lines of credit, though, it's possible for you to become a data furnisher and report information regarding account payment histories to credit reporting agencies.

There are a number of third-party services you can use as well as services offered by Experian and FICO to add positive information to your credit report. These services will usually require that you turn over private financial and account information.

That being said, there are a number of ways that you can indirectly self-report your own positive financial habits to Experian, Equifax, and TransUnion. There are a number of third-party services you can use, like RentTrack and PayYourRent, which will help you gain positive marks on your credit for on-time rent payments. You can also use Experian Boost to add utility bills and phone bills to your Experian credit report.

Another new service is UltraFICO, which lets you add the balances in your bank account into the mix when calculating your credit score. This can help lenders understand that you have responsibly managed your bank balance (not frequently overdrawing your account) and have cash in your account.

Credit Reporting FAQ

The credit reporting process isn't as straightforward as one might expect, and you can't just report someone to the credit bureau as a regular Joe. To report to the major credit bureaus, businesses and lenders must apply and be accepted as data furnishers.

I'm a Landlord: Can I Report to the Credit Bureaus?

Yes, landlords and property managers can report information about a tenant's rental payments to the credit bureaus by signing up for a rent reporting service.

All three credit reporting agencies will display rental payment information if they receive it. Of course, landlords and property managers need to be accepted as data furnishers in order to contribute this information.

I'm a Renter: Can I Report My Positive Rental History to the Credit Bureaus?

If your landlord or property manager doesn't report your rent to the credit bureaus, there are a number of reporting services that one can sign up for to have rent contribute to your positive payment history. These include:

  • Experian RentBureau: Landlords or property managers can sign up for this service to report rental payments. If they don't use RentBureau, tenants can sign up for services that do report through RentBureau, such as PayYourRent, RentTrack, or Cozy.
  • RentReporters: This service sends rental data to Equifax and TransUnion. They contact your landlord directly to verify that your rental payments are made on time and then track your rent payments.
  • Rental Kharma: Reporting to TransUnion, this service verifies your payment history with your property manager or landlord.

Can I Report Someone That Owes Me Money to the Credit Bureaus?

Individuals cannot report information to the credit bureaus. Only businesses that have applied and been accepted to the respective data-furnishing programs for credit reporting agencies can send information. There are strict requirements and rules that govern reporting, and data furnishers that don't send regular or accurate reports can have their agreement terminated.

I'm a Small Business Owner: Can I Report Another Business to the Credit Bureau?

Some credit reporting agencies also maintain credit reports for businesses in addition to consumers. These reports will include the credit accounts owned by a given business, their payment history, the amount owed, any collection activity, and more.

In order to report information regarding another business to the credit bureaus, a company needs to apply and pay for the business credit reporting service at the credit bureau they want to report to. This is a separate service from the consumer credit reporting service.

Knowledge Is Power When It Comes to Credit

It's easy to never give much thought to the world of credit reporting until it's something that impacts you directly. After all, the activity of the major credit reporting bureaus can seem pretty out of reach, and understanding how and why our credit reports look as they do can feel cryptic, to say the least.

Having negative information on your own credit report can be pretty frustrating, but it's natural for your tune to change once someone owes you money for an unpaid debt. You might wonder if you can report them to the credit bureau and, if so, how.

The truth is individuals can't report to credit bureaus, only businesses. Even then, there is a cost to doing so and a number of requirements that must be met in order to qualify as a data furnisher. Another option on the table is hiring a collection agency, but you'll want to weigh out the pros and cons before going this route.

Whether or not you decide it's worth it to become a data furnisher, there is always value in better understanding the credit reporting process. As business owners and consumers, credit files and scores can have a major impact on our financial opportunities. When it comes to your credit, knowledge is power!

For more resources about building credit and understanding the world of credit reporting, make sure you check out our Credit Building Tips blog.

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Written By:
Shaun Connell
Shaun Connell is a personal finance and credit expert with a passion for helping individuals eliminate debt and improve their credit. He's enjoyed writing investing and financial content for over 15 years, with expertise in real estate, debt, banking, credit, and wealth building. His work has been seen by millions on the web.

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