Credit reference letters are used by companies to check and inform other companies regarding the credit history of the consumer under investigation. The credit letter is usually concise and brief. The content of a credit reference letter is a comprehensive list or enumeration of all the transactions done by the consumer. It seeks to inform other institutions if the prospective consumer is a liability or a viable prospect.

The law allows institutions to divulge financial information of a private citizen. This is for the sake of security and background checking. There are people who have been using fake names and identities in order to extract cash and money from lending institutions and banks. This led to a comprehensive form of credit reference.

This can be requested if a lending agent detects something wrong with the record of a consumer. Together with the credit reference, records such as educational background and job connections are also included. This would assure banks that the identity of the consumer is genuine.

The credit reference letter is presented in a very easy to read format. The only significant part of the letter is the enumeration of payment information and the approval of the bank. Example of the letter would show:

Sample Letter

January 28, 2010

American Bank
#3434 Union St.
New York City

Mr. Carlo Cameron
Account Inspector
Quality Assurance Section
Hong Kong International Bank
#2454 Backdrop Drive, Atlanta City

Subject: Negative Credit of Mr. James Stevenson

Dr. Mr. Cameron,

Mr. James Stevenson has not been cleared by the bank due to records of late payments and negligence of completing contractual obligations. Just last year, he was late paying the monthly mortgage for an average of three weeks. Aside from that, he declared paying with collateral instead of cash.

Our institution has been very lenient in allowing him to have an extension. But it seems he have abused our consideration and ceased contacting us regarding his unpaid debt. We are sending all the records to other banks to bar Mr. James Stevenson from borrowing money and availing credit. His record has shown irresponsible and improper handling of debts and credit responsibilities.

Our managers and lending agents have recommended that Mr. James Stevenson be marked as a liability and unqualified to be admitted at any lending program.

Yours Truly,

Carl Duffman
Credit Inspector