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When an individual personally guarantees a commercial loan, we require written authorization to pull credit information. Does that authorization expire after a set number of days? Or can we pull a credit report months after receiving written authorization? – IBA Compliance Connection

IBA Compliance Connection

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When an individual personally guarantees a commercial loan, we require written authorization to pull credit information. Does that authorization expire after a set number of days? Or can we pull a credit report months after receiving written authorization?

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We are not aware of a statutory or regulatory expiration date on a consumer’s written authorization to allow your bank to obtain a credit report. However, in order to clarify the authorization, you may wish to add a provision specifying a certain time period during which you may pull a credit report in connection with the credit transaction (e.g., “throughout the term of the loan” or “as long as the customer personally guarantees the loan”).

For resources related to our guidance, please see:

  • 15 USC 1681b(a)(2) (Permits obtaining credit information “in accordance with the written instructions of the consumer to whom it relates.”)