Acessing Credit Reports

• As long as a collection agency pays the money required to access a credit report to the credit bureau that holds it, the collection agency can access the report of any person from whom it is seeking to collect money. Although credit reports are not public information, they are legally available to someone who has a legitimate business interest in knowing a person's credit history. This includes debt collectors.
  
  

Effect on Credit Score

• It is a common misconception that a collection agency checking a person's credit report will cause his credit score to decline. The only time a credit check can cause a person's score to go down is if the party doing the checking is a lender who is considering an individual's request for credit. Because the individual is not looking to take out more credit, a check by a debt collector will not hurt his score.
  
  

Reporting Debts

• Another way in which a collection agency has access to a credit bureau is through the reporting of the status of a debt. If a debt is delinquent, a collection agency may report this delinquency to a credit reporting bureau as a means to motivate the debtor to make good on the debt. This is because the presence of a late debt payment on a credit report will cause a person's credit score to decline.
  
  

Considerations

• While a collection agency has access to the credit reports of debtors for whom it is collecting debt and whose debt it is considering purchasing, it cannot access the reports of a person for whom it does not have a legitimate business interest. In addition, agencies cannot report false information to credit bureaus that causes a person's credit score to decline, particularly if it is used as leverage to get the person to pay off a debt.