When pulling a borrowers credit, is it absolutely necessary by law to first have the borrowers signed authorization? Or is a verbal authorization sufficient?

Whatever the case may be, may someone please reference me the laws this concerns. Thanks!

Technically you are required under Federal Regulation to have a signed authorization.

On that note I must say that it doesn't cease to amaze me at how many borrowers would just give their SS# to just about anyone. Personally, I would never pull someone's credit without the signed authorization form...too much liabilities. Verbal would be fine I guess, as long as the call could be recorded and the borrower was verbally giving the green light. I'm just waiting for the day when someone gets accused of identity theft for the simple reason that they did not follow procedures. Using someone's SS# is serious matter. Not worth it in my book. It takes 5 minutes to have an authorization form faxed and to receive it back.
As a consumer, I would never tell anyone what my SS# is (especially if it's a telemarketing call) until I knew for sure who I was dealing with and how reputable the company was. It could be someone down in a basement for all I know. But hey, as the saying goes "common sense is not so common." Most people are ethical but it only takes one person who's not.

Either signed authorization or if someone applies for a loan. Application for a loan is authorization to pull credit.

I agree. I just would also add obtaining Patriot Act identidy verification to make sure the person signing the form is the person they say they are.

With this much work just to apply for a loan your borrower will try lender B and you will lose the deal 9 times out of 10 because lender b will do it right away without signing a form.

http://www.bankersonline.com/operations/ci-creditreport.html

I think this answers some of my questions.