Click to return to BOL home page
Banker Store Read A Reg BOL Insiders Career Connect Learning Connect Bankers Information Network

Search BankersOnline
using Google









Alphabet Soup


Banker Store

Bankers Info Ntwk


Career Connect

Learning Connect

Guru Central


Ask a Guru

Bankers Threads

Contact Us

Give Us Feedback


About Our Sponsors

About Us

Print Friendly! Email This Article! Discuss NOW!

Credit Report - Written Authorization Required?
Answer by David Dickinson, BOL Guru
Guru Bio

Question:  When a customer applies for any type of credit with our institution (such as a credit card, consumer loan, commercial loan, home equity and/or mortgage loan) are we required to obtain written authorization, as in a signed application, before pulling the credit report?

Answer:  A bank can obtain a consumer report for any legitimate business need that is initiated by the consumer or to review an account to determine whether the consumer continues to meet the terms of the account [§604(a)(3)(F) – page 6607]. Legitimate business needs include credit transactions, review or collection of an account, opening a deposit or savings account or underwriting of insurance. You must have written authorization to request a consumer report for employment purposes, but that's another story.

Although there is no legal requirement to get the consumer’s permission or signature to allow the bank to pull a consumer report (with the exception of a report for employment purposes), the bank could expose itself to civil liability if the consumer contends that the bank did not have a legitimate business need that was initiated by the consumer. Therefore, I have always recommended you have a signed application, signature card or other documentation to justify your business need for the consumer report. Written permission would not be practical with regard to pulling a consumer report to monitor an account, however.

First published on 7/07/08

Privacy Policy    Disclaimer   Recommend This Site !   Contact Us

BankersOnline is a free service made possible by the generous support of our advertisers and sponsors. Advertisers and sponsors are not responsible for site content. Please help us keep BankersOnline FREE to all banking professionals. Support our advertisers and sponsors by clicking through to learn more about their products and services.