Who is Looking at Your Credit Report?
As a consumer, you expect lenders to check your credit report when you apply for a loan. But did you know lenders are not the only companies looking at your credit report? Even when you aren’t trying to borrow money, other companies will still pull your credit for various reasons.
The Fair Credit Reporting Act makes it possible for credit companies to release your credit information to your potential employers. They would do this as a part of your background check. Employers must get your written permission before pulling your credit report, but if you decline, the Federal Trade Commission gives the employer the right to turn down your application immediately.
When you sign up for water, electricity, or gas, there is a chance you will be asked to submit a credit check. This is because you pay your utility bill after having already used those utilities, which means the utility company is essentially giving you a short-term loan. You have to pay for the water, electricity, or gas you used last month by a certain date, so if your credit score is lower, then the utility company might decide to charge you a deposit beforehand.
Oftentimes, when you are looking for an apartment, the landlord will ask for your credit information. They do this to see how likely you would be to pay your rent on time based on your past financial behavior. Depending on how low your score is, you could be asked to pay a higher amount for your security deposit or even get rejected by the landlord altogether.
Credit Card Companies
Credit card companies will probably check your credit when you apply for a card, but the Consumer Financial Protection Bureau says that they can also look at your credit at any time once you are their official customer. These creditors will do this in order to prescreen you and decide whether they should offer a new card to you or not. This is legal under the federal law: The Fair Credit Reporting Act, but you do have the option to refuse this prescreening.
According to the Consumer Financial Protection Bureau, The Fair Credit Reporting Act makes it possible for credit reporting companies to release your credit information if it is to offer insurance coverage or set a premium charge for insurance. Just like the credit card companies, insurance companies will also use your credit to offer you insurance deals through prescreening. You can decline this prescreening process for the insurance companies as well.
If you are looking for television, internet, or phone service, then your credit will most likely be pulled by those providers. This is just for those providers to check and assess the likelihood of you paying your bill for their service.
Nursing Homes and Assisted Living Facilities
Nursing homes and assisted living facilities operate like apartment building when it comes to your credit score. They will often check your credit to make sure you are financially responsible enough to live in their facility, especially considering that it can be expensive to live in a nursing home or assisted living facility.
Government Agencies and Courts
The Fair Credit Reporting Act allows credit reporting agencies to release your credit information for three reasons. The first is in response to a court order, the second is in response to a subpoena, and the third is for child support and enforcement purposes. The government also has the right to check your credit if you apply for government assistance in order to see if you actually qualify for it or not.