6 Ways to Check Someone Else’s Credit Report

6 Ways to Check Someone Else’s Credit Report
GUIDE
BadCredit.org Staff
By: BadCredit.org Staff
Posted: March 2, 2015
BadCredit.org's popular "How-To" series is for those who seek to improve, rebuild or better understand their subprime credit rating.

We all know a person’s credit report tells a lot about them – and not just financially. A credit report contains personally identifying information such as where you live, date of birth, social security number and even employment records.

It also contains information about lines of credit, account balances, payment history and whether any collections or financial judgments have been filed against someone.

With all of this sensitive and personal information available, is it ever possible – or even legal – to check someone else’s credit report? The short answer is yes. With the proper authority, anyone can obtain a copy of another person’s credit report.

The key here, though, is having what the Fair Credit Reporting Act refers to as “permissible purpose” to access the report.

Here are six ways to check someone else’s credit report and not end up on the wrong side of the law.

1. Evaluating prospective tenants

Checking Renter's Credit Score

Landlords want to know their tenants will reliably pay rent every month.

When you’re considering renting a property to someone, the law allows you to request a copy of their credit report. However, the credit reporting agencies require a signed authorization from the individual prior to releasing their report.

This is not only a valid and legal request but it also simply makes good sense for a landlord to do.

Although Equifax, TransUnion or Experian won’t give you a report directly, there are many companies that, for a fee, will pull credit reports for you from the big three credit reporting bureaus.

Just do a quick search for “tenant screening” or “local credit reporting agencies” and you’ll find them.

2. Screening job applicants

Current and prospective employers are also allowed to request an individual’s credit report – again, with written authorization first.

There are certain things credit reporting agencies can’t share with a prospective employer, though, including the age, race or marital status of a potential employee.

We should make a note that employers aren’t checking your credit score — this is a common myth. Instead, they’re pulling copies of your credit report, which contains the information that forms the foundation of your credit score.

You can contact several different companies to see your credit score before the employer does. Keep in mind that not all credit scores are the same, but they will generally be very similar to one another.

3. During insurance underwriting

Getting Your Credit Report for Free

You can easily pull your own credit report for free once a year at AnnualCreditReport.com.

Insurance companies and their authorized agents can also request a copy of a credit report for an individual they may be considering insuring.

Here they are looking for a consistent record of on-time payments, which likely indicates stability and not a lot of risk-taking — which, ideally, indicates you’re not as likely to file a claim with them.

Having a good credit profile can actually save you significant money on your monthly premiums.

4. Evaluating parental guardians

Child support and child protection agencies can also request a copy of an individual’s credit report for the purposes of establishing income and debt information. These requests are usually made by the courts and don’t require an individual to provide their written authorization.

Because this pull could happen frequently, the Consumer Finance Protection Bureau has been taking strides to improve security measures that could prevent children from becoming victims of identity fraud.

5. During mortgage underwriting

Of course, mortgage companies and lenders have access to an individual’s credit report when a loan application is filled out. But this category of request also applies to businesses and sole proprietors who have a “legitimate business need” to access someone’s report. This can cover a broad range of requests by anyone you may have business dealings with.

Having trouble financing a home with bad credit? There are lenders out there willing to work with you.

6. Between family members

Family members and parents have the right to request a copy of the credit report for their minor children, as well as for aging parents. This is a good idea to do periodically, especially since fraud and identity thieves often target younger or older individuals who are less likely to catch on to such activity.

There are companies who specialize in obtaining credit reports for valid business reasons. However, you should be wary of companies that claim they can access anyone’s credit report for a fee. Obtaining and using someone’s credit report illegally can result in a lawsuit and potentially thousands of dollars in fines.

Consider that pulling someone’s credit report shows up as an inquiry that appears on their report from that point forward. It may also impact the person’s credit score, although this is usually temporary and is likely to be only by a few points.

When you have a valid business reason or “permissible purpose” to pull someone’s report, then adhere to the proper channels in doing so. The alternative could be painful for everyone.

Photo credit: sheknows.com, appleproperty.co.za, Alamy