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Legal Credit Reports - Who Can Access Your Credit History

Who Can Legally Pull Your Credit Report?

Last Updated: February 18, 2016

Fortunately, there are laws that regulate who can access your credit report. The last thing you want is for your credit report to fall into the wrong hands. Not only does your credit report contain information about you, such as your social security number, it also contains a thorough record of your debts and accounts, something you aren't likely to want to share with anyone unless it's absolutely necessary.

The Fair Credit Reporting Act (FCRA) is a federal law that mandates the rules and regulations for the credit reporting industry, and it protects each consumer's private information by restricting credit report access only to those who have permissible purpose to conduct a credit inquiry.

In Section 604 under "Permissible Purpose," the FCRA outlines the rules about exactly who is legally able to access your credit report and why.

Banks and Credit Card Companies

Banks and credit card companies make a profit by loaning money to consumers and then collecting interest on the loan amount. When you apply for a loan or credit card, your lender reviews your credit record to determine how likely you are to repay your debt responsibly. The lender then assigns you an interest rate based on your risk level via a process known as price-based risk assessment.

Your credit report contains all the information your lender needs to conduct a price-based risk assessment. Although many lenders will ask you for your permission before pulling and reviewing your credit report, they are not legally required to do so.

Prospective Employers

If you plan to apply for a new job in the near future, be aware of the fact that more and more prospective employers are reviewing applicants' credit records before making hiring decisions. Each employer's reason for conducting credit inquiries differs, but many look to see how responsibly you pay your debts since, for many, this is an indicator of how responsibly you will perform at your job. Still others look to credit reports to determine if your level of debt is high enough to make you a theft risk to the company.

A prospective employer must have your written permission before pulling a copy of your credit report. If the employer decides not to offer you the job based on information within your credit records, it must notify you of that fact and notify you of your federal right to a free credit report based on adverse action.

Debt Collectors

Your credit report contains your most recent address and your previous addresses for the past five years. If a debt collection agency cannot locate you, it may pull your credit report as part of the skip-tracing process. Debt collectors also conduct credit inquiries in order to evaluate your assets and determine if you make a good candidate for a lawsuit. Like lenders, collection agencies have permissible purpose to access your credit records and do not require your permission to do so.

Landlords

If you decide to rent a house or apartment, you can expect to undergo a credit check. Landlords check your credit to ensure that you pay your debts on time. Renters who pay other creditors on time are more likely to also pay their rent in a timely manner.

When reviewing your credit history, landlords pay close attention to any past evictions you have on file. Evictions are public records and, as such, appear on your credit report for up to seven years. Regardless of whether or not you pay your debts in a timely manner, a previous eviction serves as a red flag for many landlords and could negatively affect your ability to get approved for housing.

Pulling Your Own Credit

Companies you do business with are not the only ones who can access your credit history. The FCRA gives you the right to request one free credit report each year from the credit bureau of your choice. Some states, such as Georgia and California, provide residents with two free credit reports per year. Taking advantage of your right to a free copy of your credit report helps you identify any errors your report contains and work toward correcting them.

The FCRA prohibits the credit bureaus from releasing your credit history to any company or individual that does not have permissible purpose to view it. Should this occur, you have the legal right to file a lawsuit against the person or business that requested your credit report without your permission.

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Additional Permissible Purposes to Pull Your Credit Report

Besides the reasons given above, there are also some other reasons your credit report might be pulled. Keep in mind, you do not have to give written permission to someone so they can access your report. Actually, it is perfectly legal for a company to pull your credit file without written permission so long as their reason falls within one of the FCRA approved reasons. Here are some additional permissible purposes:

If you don't want a company to access your credit reports, be sure to not give them your name, address, date of birth or social security number. These are the variables a lender must have in order to pull your credit files.

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