Types of Credit Reports
In-File Credit Reports
An in-file credit report is a basic type of credit report. It pulls information directly from one or more of the big credit bureaus. This report shows the borrower’s credit and any public records as they are, without any updates for the credit application.
For the report to be acceptable, it needs to have information from three different credit bureaus. However, if a borrower doesn’t have enough credit history, or if their credit information is locked at one of the bureaus, then reports from just two bureaus are okay. In cases where only one bureau can provide a report, it’s still fine as long as the lender can get a credit score for the borrower and had tried to check all three bureaus.
If the report misses any large debts that the borrower mentioned in their loan application, the lender must get a separate document that verifies each missing debt. Also, if any of the borrower’s accounts weren’t checked with the creditor in the last 90 days, the lender needs to get an updated report or separate verification for those accounts.
Automated Merged Credit Reports
An automated merged credit report combines information from multiple credit bureaus into one report. If the report is for more than one person, like in a joint application, it will include credit data for each applicant.
This report must also cover information from three credit bureaus unless there’s not enough data or one of the borrower’s credit files is frozen, in which case two bureaus are enough. It’s acceptable to use information from only one bureau if that’s all that’s available, but the lender must be able to get a credit score for the borrower and should have tried to get information from three bureaus.
The report can’t come from a credit reporting agency that’s connected to the lender. It must include all the credit information from the original in-file reports and specify which bureaus were used. The report doesn’t need to repeat the same information from each bureau unless there’s a difference in the details. If there’s conflicting information, the report should either list both or include the information that shows the worst payment history or current status.
Residential Mortgage Credit Reports
A residential mortgage credit report is a more detailed report. It looks at the borrower’s credit, work history, where they’ve lived, and any public records.
The agency creating this report must check with at least two major credit bureaus for every place the borrower has lived in the last two years. All the information needs to come from sources other than the borrower. If there are co-borrowers who have gotten credit separately, the agency needs to check the credit history for each but can put all the information into one report. This report has to clearly state it’s done this.
The agency must also check the borrower’s current job and income. If the borrower has changed jobs in the past two years, the report should cover their previous job and income too. The report needs to clearly say that the job was verified, who verified it, and when.
The report must list who asked for the report and who paid for it. If the lender ordered and paid for the report but has a documented relationship with the billed party, only the lender’s name is needed.
The report must be sent to the person or office that requested it, in a way that follows legal rules, like through mail, fax, or electronically. It needs to include a statement that it meets all the requirements for a residential mortgage credit report.
If the agency finds incomplete information, suspects the borrower didn’t disclose everything, or finds clues of possible undisclosed credit records, they must talk to the borrower to get more information or do more research to check those records.
References
For more details, visit Types of Credit Reports of the Fannie Mae Selling Guide.