Teletrack is a consumer reporting agency that provides lenders with information about a borrower's credit history, particularly focusing on their banking and transactional behavior. When applying for a loan, lenders may use Teletrack as one of the tools to assess the risk associated with lending to an individual.
Here's how Teletrack works in the context of a loan application:
Data Collection: Teletrack gathers information from various sources, including banks, credit unions, payday lenders, and other financial institutions. This information typically includes details about a borrower's checking account history, such as account balances, transaction activity, bounced checks, and any outstanding loans.
Risk Assessment: Lenders use the information provided by Teletrack to evaluate the creditworthiness of loan applicants. By analyzing an applicant's banking behavior and history, lenders can assess the level of risk associated with lending to that individual. For example, a history of bounced checks or overdrafts may indicate financial instability and could affect the lender's decision.
Loan Approval: Teletrack data is used as part of the loan underwriting process to determine whether an applicant qualifies for a loan, as well as the terms and conditions of the loan. In some cases, lenders may be willing to extend credit to individuals with less-than-perfect credit histories, but they may impose higher interest rates or stricter repayment terms to mitigate the perceived risk.
Consumer Rights: Like other consumer reporting agencies, Teletrack is subject to the Fair Credit Reporting Act (FCRA), which regulates how consumer credit information is collected, reported, and used. Under the FCRA, consumers have the right to request a free copy of their Teletrack report once every 12 months and to dispute any inaccuracies they find.
Overall, Teletrack provides lenders with additional insights into a borrower's creditworthiness beyond traditional credit reports. However, it's important to note that not all lenders use Teletrack, and its use can vary depending on the type of loan and the lender's policies