Fact check: Your credit score doesn't come from the government

The claim: The government gives you your credit score 

A meme about credit scores first shared in March is making the rounds again on Facebook.

The meme uses a well-known template of a man in a Spiderman costume standing in front of a white projector screen. Text over the screen says, "The people who are 30 trillion in debt are giving you a credit score." The March 22 post containing the meme has been shared more than 800 times in six weeks. 

The "people who are 30 trillion in debt" presumably refers to the United States government. In February, the Treasury Department announced that the country's debt had surpassed $30 trillion for the first time, according to Forbes.

While the debt figure is correct, the government doesn't issue credit scores. 

Instead, scores come mostly from three major credit reporting agencies: Equifax, TransUnion and Experian. While these agencies are highly regulated, all three are private companies and are not part of the government.

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The user who posted the claim could not be reached for comment. 

Contrary to what some may believe, the government does not calculate credit scores.

Credit reporting agencies are private entities

While more than three credit ratings agencies exist in the U.S., the three major ones account for the bulk of credit scores. All three companies are publicly-traded, for-profit entities, according to The Balance, a personal finance news site.  

Each agency has its own process for determining a consumer’s creditworthiness based on their bill payment history, current debt and other financial information. 

The agencies make money by compiling credit reports and selling the information to interested parties, such as lenders who are considering people for loans or credit cards, The Balance reported. Employers and landlords generally need a person's written permission before they can access a person's credit report.

Credit reporting agencies are highly regulated under the Fair Credit Reporting Act, signed into law in 1970, according to Investopedia.

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The credit reporting act, among other things, delineates which information a reporting agency can collect. It also limits who can see a credit report. Lenders and insurance agencies might request information before offering services to a client, and the government can also request a report in some cases, such as when a person applies for a specific type of license.

Under a 2003 amendment to the credit reporting act, consumers can receive a free copy of their credit report from all three agencies once a year.

Our rating: False

Based on our research, we rate FALSE the claim that the government issues credit scores. Three credit reporting agencies – Equifax, TransUnion, and Experian – calculate the majority of credit scores, and while the industry is highly regulated, all three companies are private. 

Our fact-check sources: 

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