Whether you are applying for a mortgage, a credit card, or financing for an automobile or business, your credit history becomes important any time you want to take out a loan. Anyone who you do business with can obtain a copy of your credit report. Employers also regularly check credit histories as part of a background check of new hires. In addition, once you have opened an account, the lender can also use your credit report to review your account to determine whether you continue to meet their criteria.
Many federal and state laws put limits on what can be done with the information in your report. The Equal Credit Opportunity Act, for example, prohibits discrimination based on age, race, gender, marital status, religion, color, national origin, or the receipt of public aid. A creditor cannot use these factors to refuse you credit, allot you less credit or offer you different terms for which you otherwise might qualify. Other laws spell out similar restrictions for the use of the information in your credit report.
