Who Has the Right to Access Your Credit Reports?

Have you ever reviewed a copy of your 3 credit reports? If not, you should make a point to do so sooner rather than later. Your credit reports can contain a vast amount of personal information about you. This information, collected by the credit reporting agencies (CRAs), may detail your current and previous addresses, employment history, date of birth, social security number, plus a history of the various types of accounts you have opened and how those accounts have been managed month after month, year after year. Did you know that there are many parties that can access your credit reports and, by extension, has access to your credit information?

The amount of personal information which the 3 major credit reporting agencies (CRAs) have compiled about you can be staggering and honestly even a little scary. To some it may even feel like you are being watched or spied upon. And while your credit reports certainly have the ability to impact your life positively (especially if you have made the effort to earn or rebuild good credit), you would not want your personal credit information falling into the wrong hands. Thankfully, the federal government regulates who is allowed access to this sensitive information.

Permissible Purpose to Access Your Credit Reports

The credit reporting agencies earn multiple billions of dollars every single year, in large part by selling the information they have collected about you and 200+ million other consumers living in the United States. Although the CRAs do not need your permission in order to create credit reports about you, neither can they release the information compiled about you to just anyone.

Permissible Purpose

The Fair Credit Reporting Act (FCRA), the chief federal law which governs the CRAs, has a strict limitations which dictate who may legally be permitted access to your credit information. Section 604 of the FCRA is titled “Permissible Purposes of Consumer Reports.” In order for credit report access to be granted permissible purpose, as defined by the law, must first exist. Here are some of the most common examples of permissible purposes for a CRA to release a copy of your credit report.

  • Court Order
    • If a court orders access your credit reports then the CRAs are allowed to hand over your information.
  • Access to Your Own Report
    • Under the FCRA you are allowed to access your own credit reports as often as you like. In fact, the CRAs have to provide you with a free copy of your credit reports each year (if requested) via AnnualCreditReport.com.
  • Credit Transactions
    • This includes any applications which you initiate for new accounts, loans, credit cards, lines of credit, etc.
      Credit Transactions
  • Employment Purposes
    • Your written permission is required if your credit is being reviewed by a current or potential employer. Some states have disallowed the practice (except in certain industries), but it is still fully legal for employers to access your credit reports under federal law.
  • Insurance Underwriting
    • When you apply for an insurance policy your credit can legally be accessed.
  • Account Management
    • Your existing creditors are permitted to review your credit as often as desired. Many creditors do so, especially credit card issuers, to ensure that your level of credit risk has not changed.
  • Collection Efforts
    • Collection agencies are allowed to access your credit reports for skip tracing purposes. They do not need your permission in order to do so.
  • Determining Capacity to Pay Child Support
    • Your credit reports can be accessed and used to determine how much child support you can afford to pay.
  • Pre-Screening Potential Applicants
    • The CRAs sell mailing lists, based upon your credit data, to credit card issuers and other companies for prospecting purposes. As long as the company purchasing the data intends to use the information to issue you a “firm offer of credit or insurance” this access to your credit reports is allowed. You can, however, “opt out” of allowing your credit information to be accessed in this manner by visiting OptOutPreScreen.com.

Consumer Disclosure

As you can see above, there are numerous legal instances when your credit reports may be pulled without your knowledge or permission. Yet the CRAs are always required to let you know whenever access to your credit information has been granted.

Consumer Disclosure

This disclosure is known as an “inquiry.” An inquiry is a record which tells you that access to your credit information has been granted and they are required to remain on your credit reports for 6-24 months (depending upon the type).