A credit check is an important consideration in any incidence of financial transactions and serves to measure the worth of the person involved. Whether it is a lender, an employer, or a landlord, knowledge of a person’s credit is very important for the basis of some decision. This paper portrays how to conduct a credit check on someone, stating an overview of what is required by the law and other ethical considerations. This post, therefore, aims to give a baseline understanding of what a credit check is. It further covers the importance of carrying out this analysis and how to carry it out responsibly.
Can I Conduct A Credit Check On Another Individual?
Credit checks are critical processes that need to be observed by all means, looking at the requirements of the law in the letter. The Fair Credit Reporting Act (FCRA) stipulates that you can conduct a credit check on someone else only when either you have a ‘permissible purpose’ or the person has written his or her permission. The permissible purpose includes cases whereby one has to be assessed for a loan, employment, tenancy, or any other financial contract.
The individual shall give written consent where there is no permissible purpose. The consent shall be plain, express, and clearly documented to the fact that the individual understands the actual credit check being undertaken. It is illegal to run a credit check in the absence of such permission or on the basis of a permissible purpose. Furthermore, such illegal acts can force one into legal action up to the point of punitive damage, fine, or even imprisonment.
How Do I Run A Credit Check On Someone Else?
Running a credit check against someone else is a procedure that calls for careful adherence to the legal stipulations laid in place to ensure their privacy is observed and actual protection with regard to the Fair Credit Reporting Act (FCRA). Below is a guideline on how to go about this step by step:
- Get written permission: First and foremost, one has to get written permission to have a certain person’s credit checked. This isn’t just for that matter’s sake but also legal reasons.
- Obtain Required Information: To gather required information, one will need to provide the full name, ID Number, and current address of the involved individual or entity. This is to make identifying a person in the credit bureau system records easy.
- Choose a Credit Reporting Agency: The first step should be to contact a major trio: Equifax, Experian, or TransUnion. These are the only authorized organizations to provide an individual with a credit report.
- Requesting the Credit Report: Now that we have the go-ahead and all the needed details, it is time to ask for the report. In fact, private landlords may also engage in something like TransUnion SmartMove to facilitate tenant screening. An employer can order a Pre-Employment Evaluation Report (PEER) from TransUnion via a third-party hire solutions provider.
- Review of the Credit Report: After obtaining the credit report, review it for the information you want to confirm. Credit reports usually encompass credit history, employment history, previous information, address, and other information with financial reference.
- Use the Information Responsibly: According to the advice notice, only use the information obtained from the credit report appropriately and for the intended reason alone. Misuse of credit report information might lead to some legal punishment.
What Info Do I Need To Run A Credit Check On Someone?
First, get written consent from the person. You will need their surname and a South African ID or a valid passport number. Next, register for WinCredit to gain access to credit bureau databases. Windeed.com charges a query fee of R37.35 per Experian-powered consumer profile search. Use the Windeed website to follow prompts that will guide you through keying in the required details and receiving the credit report. This process ensures one’s privacy and rights are shielded.
How Long Does It Take To Conduct Credit Checks On Someone?
The time it takes for a credit check varies according to various factors, from the mode one has requested the report to the all-important degree of responsiveness by concerned credit bureaus. In most cases, if all important information and consent to request the report exist, it does not take long to get one, particularly using online means.
If you request a report via the Internet from one of the three major credit bureaus, you will most often get an instant report. Request one through the mail or in any scenario where more legwork is required, and you are most often looking at days to weeks for the turnaround.
In other cases where employment is pegged alongside tenancy to the results of a background check, which includes a credit check, the process of such a deep background study is likely to be lengthened in the time consumed. If the information presents errors or any odd movement, the time consumed will be escalated to resolve those issues.
