Investigative Consumer Reports vs. Credit reports: Know the Difference

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In today’s digital age, it seems personal information is everywhere and easy to come by. If you’ve recently applied for a loan, tried to rent an apartment, or applied for a job, chances are you’ve been subject to a background check of some kind. While you may be familiar with credit reports and the major reporting agencies, you may not be as familiar with specialty agencies that collect and disseminate personal consumer information.  

What is a Specialty Consumer Reporting Agency?

A Specialty Consumer Reporting Agency (CRA) is a nationwide company that collects and sells personal information about individual consumers that can be used in decisions about providing such things as credit, banking services, housing, utilities, medical care, and employment. Specialty CRAs are different from the major nationwide credit reporting agencies—Equifax, Transunion, and Experian—that specialize in collecting strictly financial information. Specialty CRAs collect a variety of different types of consumer information, including the following:

  • rental histories
  • various insurance claims including auto and home
  • health data
  • medical payment histories
  • employment records
  • banking histories

Many of these specialty companies focus on collecting just one type of information, say employment histories, and then sell that to third parties who amalgamate the data and then sell access to comprehensive consumer information databases that can be used for such purposes as pre-employment background screenings. 

These companies also perform investigative reports, also called CRA background checks. These reports are compiled searches of nationwide databases as well as via interviews with friends, coworkers, landlords, and neighbors and include information such as the following:

  • personal traits
  • overall reputation
  • character
  • living standards
  • criminal history
  • driving record

Investigative reports do not contain credit information; as a point of fact, creditworthiness cannot be considered in an investigative report and lenders cannot use investigative reports as part of their process. 

What is the Difference Between and Credit Report and a Consumer Report?

A credit report is a document that reports a consumer’s financial history. It provides information about the number of credit accounts a consumer has, their total credit availability, their payment history, and whether or not open accounts are past due or in good standing. A consumer report, in contrast, provides personal information well beyond credit. It may include Continuous Monitoring information on any criminal history, employment and education history, and driving records. Credit and consumer reports are both subject to the regulations spelled out in the Fair Credit Reporting Act (FCRA).

The Bottom Line

You are far more likely to have a credit report pulled on you than an investigative consumer report. Pre-employment screenings often include both. Either way, the FCRA requires you to be informed and given the opportunity to consent to having your background checked, that you be notified of any adverse findings, and that you must be given the opportunity to correct any errors. Know your rights.