In this day and age, any time a consumer looks to obtain credit, they can count on filling out a credit check application. A credit check application has become an important part of the money-lending process, as it allows a potential lender to obtain insight about the person hoping to obtain credit.
A consumer can anticipate needing to fill out a credit check application for virtually anything and everything, unless they can pay off an item immediately and in cash. Any time a business extends a line of credit to a customer, they require a credit check application to be filled out. Some of these credit check applications are far more extensive than others—some simply require the customer’s name, date of birth, address and Social Security number, while others want background information like places of residence over the past seven years, personal references and an employment history.
No matter how in-depth the credit check application is, they will all go to at least one of three places—the major credit agencies. Equifax, Experian and Transunion provide credit information on the applicant to the business that sent in the credit check information, helping the business make a decision on how much money (if any) to lend to the customer.
Many businesses, especially large ones like automobile manufacturers, have their own financing companies to provide credit to customers. Other business work with major banks or other lending institutions to provide credit. Either way, a credit check application is required before they will do business.
The information on a credit check application can make a huge difference in how much money a customer can receive, if they are receiving a loan or financing. If the information on the credit check application checks out and the customer has a good credit score, they will likely be extended a greater line of credit at a lower interest rate. A bad credit history will mean less credit, higher interest and possibly a reject.
Even credit card companies use credit check applications. When a customer applies for a card, that application serves as a credit check. The information then helps the credit card company decide where to set the credit limit for the customer, if they are accepted.