This is basically where all the troubles really began. When the credit bureaus started they slowly but surely managed to obtain almost all information about the financial foot prints of any person they wished. They sold themselves very well and managed to get the cooperation of almost all lenders. The lenders or any other organization dealing with the finances of individuals reported to the credit bureaus any financial infractions along with the accounts affected and soon the bureaus were able to compile a detailed report on the credit infractions an individual committed. The information would then be sold to other lenders or lending institutions that needed to determine if an individual was creditworthy.

The problem is that sometimes errors were made by these financial institutions in reporting to the credit bureaus properly. This created a situation where many thousands of people were given a bad credit reputation by mistake. There have even been reports that people were forced to go into bankruptcy or even loose their families because of these errors.

As with all things where private information is made available there are good points and bad. The benefits are that there are fewer events of bankruptcy and foreclosures because the lenders could properly evaluate the creditworthiness of individuals before a loan was approved. On the flipside those people who have made financial mistakes in the past would not be easily forgotten or forgiven. A bad credit report lingers around for a very long time.

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