Question:

What is a home loan credit report used for?

Answer:

A home loan credit report is used by lenders to identify your reliability as a borrower. A home loan credit report will tell where you live, if you pay your bills, how many credit lines you have, will show any liens, car loans, etc. A credit report will also show if you have ever been sued or bankrupt.

You should know that you are entitled to a free credit report once every twelve months by each of Equifax, Experian, and TransUnion - the nationwide consumer reporting companies. The Fair Credit Reporting Act (FCRA) enacted by the Federal Trade Commission (FTC) promotes that the three credit bureaus keep the information in the credit reports private.

However, information on your credit report will be sold to employers, creditors, and insurers to evaluate your application for credit and employment. You will need your credit report any time you apply for a home loan, car or other big purchase, or start a new job. Also, credit reports help identify identity theft - that is, if someone has used your personal information to get a credit card and incur purchases with your name on it. Identity theft has recently become a popular fraud.

You should also be warned there are many websites that will offer to deliver to you a "free" credit report - it will often be free for a trial period, and later credit card charges are likely to begin without your consent.

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