You might think that your credit reports are relatively private, so you could be surprised to learn that more than just your bank or creditors can get access to them. However, the federal Fair Credit Reporting Act (FCRA) (15 U.S.C. § 1681 and following) and state credit reporting laws restrict who can access your credit reports and how they can be used.
These laws allow only certain entities to access your credit reports in specific situations. They also restrict how your credit information can be used. Still, quite a few businesses and entities, beyond the usual credit card issuers and other lenders, are allowed to order your reports.
According to the FRCA, the following people and entities can request your credit reports.
These people and businesses can review your report when you apply for credit or to monitor your credit once they've given you a loan or credit, subject to some restrictions. For example, for a new transaction, you must have made an offer or initiated a credit transaction before the creditor can review your report.
If you're seeking to borrow $150,000 or more, mortgage lenders can see some information—in particular, older information—that wouldn't be provided to other creditors.
Landlords might get a report from a specialty consumer reporting agency that tracks rental histories, including evictions.
However, state rules often prevent utility companies from denying you service in many circumstances, even if you have bad credit. To learn about programs and laws that can help you avoid utility disconnections, see this article on preventing a utility shut-off.
As of July 1, 2010, the government makes federal student loans directly; private lenders don't offer them. Generally, you can't be denied a direct federal student loan based on your creditworthiness. But credit will be checked for PLUS loans. Also, you can't get a new federal loan if you're in default on another federal loan unless you've made satisfactory arrangements to repay it.
Lenders of private student loans (those not offered by the government) can use credit reports to make loans or monitor existing loans.
These companies can look at your reports if you apply for a policy. Usually, they're not interested in your credit history but instead may ask about your medical history or any insurance claims you have filed. A credit reporting agency can't provide an insurance company with a credit report that contains medical information unless you consent.
If you're seeking life insurance for $150,000 or more, the insurance company can see older information that wouldn't otherwise be included in your credit reports.
These companies often use credit information to help determine how much to charge when offering a new policy.
Tens of thousands of employers review credit reports to evaluate job candidates. Employers use this information to judge financial honesty and integrity and the risk of bribery of people with a lot of debt.
And, once you're hired, employers can use the report for just about anything related to the job, including promotion and reassignment decisions.
Government agencies can request your credit report for several reasons:
Collectors look at your report to locate you or learn more about your assets.
Judgment creditors trying to collect a debt based on a credit transaction involving a regular creditor can look at credit reports to decide whether to begin collection efforts against you. They can also use reports to locate you or your assets.
At least one court has said that individuals who don't regularly offer credit can't get credit reports to attempt to collect a judgment, but other courts disagree. So, in some districts, individuals may also be able to get a credit report to collect on a judgment (for example, a judgment for alimony or child support).
Even if a person, agency, or business does not have another permissible reason to get your report, if it can get a court order (not easy to do), it can get your report. For example, the IRS might get a summons that allows access to your credit report. Generally, you would have notice and a chance to oppose the request for a court order.
Apart from those listed above, most other people and businesses can't legally request copies of your credit reports. For example, your credit report may not be used in divorce, child custody, immigration, and other legal proceedings. Nor can district attorneys look at your reports to investigate civil or criminal cases.
Also, just because the FCRA allows creditors, employers, landlords, and others to pull your credit reports doesn't give them, or anyone else, an open license to review your reports. In all instances, that entity must have a "permissible purpose." If it doesn't, that entity must have your permission before pulling a report.
As described in more detail above, the FCRA lists permissible purposes for pulling a credit report, which include the following:
If the person requesting your credit report doesn't have one of the "permissible purposes," then your credit reports are off-limits. Period. If your neighbor, ex-girlfriend, co-worker, relative, or complete stranger pulls your credit report, you can be relatively certain they've probably violated the FCRA.
It gets tricky, though, when a potential creditor, employer, landlord, or another person you have some colorable relationship with overreaches and grabs your report without a permissible purpose.
Here are some common scenarios when an individual or other entity pulls a report without an impermissible purpose:
It's not always easy to find out if someone who shouldn't have access to your credit reports has requested and received one anyway. One way to detect unauthorized users is to order your credit reports from AnnualCreditReport.com and look for unfamiliar names or businesses in the list of inquiries.
If someone has requested your report illegally, you might be able to sue them for violating the FCRA. Your state's laws might offer additional relief and remedies. Talk to a lawyer for more information on filing a lawsuit.
You can also complain to state and federal government agencies.