Who Wants to Know Your Credit Score?

Who Can Request a Credit Check on You


Learn About Credit ScoreNot that long ago, credit scores were exclusively used by banks to issue loans. No one else cared whether your credit rating was high or low. Today, more companies want to check your credit score, but those companies aren't interested in loaning you money.

In the past, a poor credit rating meant difficulty getting an affordable mortgage. Today, your credit score range can decide how much your car insurance premiums cost or if you can get auto insurance at all. A bad credit score can jack up your phone rates or deny you homeowner's insurance coverage.

So who wants to know your credit score? Banks and lending institutions obviously do, but the other answers may surprise you.

Landlords and condo associations

Apartment-hunting can trigger a credit rating check. Landlords have long used credit ratings as a rough indicator of tenant responsibility. Their reasoning is pretty solid, since steady repayment of loans and other debts bodes well for paying rent on time. Condo associations and property management groups routinely ask for a credit report and score.

"We'll need three references, your credit report and score"

Employers are beginning to check credit scores. Employers argue that a good credit history is the sign of a dependable employee. Employers also like the savings, since a credit history usually costs less than a traditional background check. On the bright side, a potential employer can't obtain your credit information without your consent.

Poor credit rating equals higher insurance premiums

Both car and homeowner's insurance companies have made a credit score check part of the standard procedure for getting coverage. Do they need your credit information? They say they do. Insurance companies claim that a good credit score is associated with people who are better insurance risks. A good credit rating can earn you favorable rates and qualify you for better coverage. On the flip side, a poor credit score can cost you on premiums.

Rising healthcare costs are also making health insurance carriers check credit scores along with medical histories. It seems as though payment delinquency could become a pre-existing condition.

So who needs your credit rating?

The Fair Credit Reporting Act (FCRA) specifies who can request your credit rating. Employers, insurers, and landlords are all legally entitled to request your credit history. However, you generally retain the right to refuse consent to a credit check request. Unfortunately, a refusal shifts the burden of proving your eligibility to you. A refusal may also automatically scuttle your chances - not a desirable outcome if you really need that job.

Not knowing your credit history is a good way to get blindsided in today's society. It's wise to monitor your credit report and score so you know what these agencies are seeing. Many financial advisors recommend checking your credit score before making a major purchase or before applying for a job.

 

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