Generating credit reports is essential for any business. It’s one way to ascertain the credibility of a loan borrower, job applicant, or customer availing of your products or rental services. With the advancement of modern, digital technology, generating credit reports has evolved. API integration makes the process of ID verification, generating soft-pull reports and hard-pull credit reports, and detecting red flags a lot easier as it’s tailored to fit to your business’s requirements.
In this article, you’ll learn how to incorporate API integration for credit reports. Read on to get to know the nuts and bolts of the process.
What Is API Integration For Credit Reports?
Application programming interface (API) pertains to a set of functions enabling applications to access data and directly communicate with operating systems, microservices, or external software components. It may sound too technical, but API for credit reporting acts as a messenger, such that it delivers your request to the credit bureaus to generate and access credit reports, and then deliver their system’s response back to you.
API integration for credit reports refers to an API solution that integrates your business systems, such as your online financing, loan origination system (LOS), customer relationship management (CRM) software, and more.
You can easily incorporate API integration for credit reports by relying on a trusted and proven API solution that offers the following benefits:
- It generates credit reports in a standardized credit bureau format for both human-readable and raw bureau data formats in the same response
- Get to choose from multiple formats.
- End users don’t need to worry about storing credit data in their software because API integration allows recalling credit reports and applicants in real-time
- It delivers soft pulls, hard pulls, ID verification, liens and judgments, fraud checks, alternative credit data, and red flags in a standalone or the same request.
API Integration For Credit Reports In The Mortgage Industry
Mortgage companies deploy several software systems to manage their business. The plethora of technologies include a point of sale (POS), cloud-based phone system, LOS, CRM, email platform, and pricing engine, among others. Now, the big challenge to mortgage lenders is keeping all systems synchronized and working together.
Fortunately, API integration has been developed, allowing software systems that mortgage lenders use to exchange data and keep data synchronized. With API integration, mortgage loan officers, branch managers, and corporate managers can use the same accurate consumer data, driving significant benefits for mortgage companies.
API integration for credit reports is a great feature that mortgage companies should consider investigating when licensing or purchasing a new software system. Because API is a great way for two or more software applications to share information and extend their functionality beyond its original capabilities, API makes it possible for CRM to share data with LOS and generate credit reports at the same time.
Here’s how API integration for credit reports in the mortgage industry works:
- API Integration Languages: Development teams use different technical terms, such as REST API’s, SOAP API’s, XML API’s, Web Services, HTTP or HTTPS, and SDK’s. They lay ground for different API integration techniques to accomplish the goals of getting two or more software systems working together.
- Data Management: A CRM stores information about the mortgage borrower, while the LOS stores information about the same borrower. On the other hand, API for credit reports from three major credit bureaus provide information about the same borrower’s credit standing. The API integration of the CRM, LOS, and credit reporting will keep all systems aligned in data they’re storing about the borrower.
- API Integration Process: Each software system (CRM, LOS, and API for credit reports) defines the data included and the manner it can be accessed via API integration. In simple terms, each software system has a dictionary of what data they can support and bears the instructions on how to access information. When two or more software services integrate with each other, they’ll share their API documentation, facilitating development teams to kickstart and process the API integration.
- Practical Application: When a mortgage loan officer meets with a potential customer and collects information required in the loan origination, there’s no need to enter the same data into the LOS and CRM. With API integration for credit reports, the appropriate data (credit report) will be passed between the two systems automatically and instantaneously. The processes involved are efficient, with reduced or even zero errors, creating a happier borrower in return.
API Integration For Credit Reports In The Lending Industry
Funding is vital in business growth. However, lending businesses lack data access to formal credit. Banks and lending companies have difficulty conducting a credit risk assessments. Brokers and lenders need to verify identity before approving a loan or giving away credit. They’d verify the authenticity of a client by manually going through driving licenses, passports, utility bills, and other documents, including credit checks.
With the advent of API integration, all verification processes, including generating credit reports, can be performed digitally. Brokers and lenders can just search for the information they need using an API system, and the data of the potential client pops up on the system, as simple as Google search.
Step-By-Step Guide On How To Incorporate API Integration For Credit Reports
This topic explains in detail how the process of API integration takes place, which applies to any API integration. Since this topic is API for credit reports, you can focus on API integration for credit reporting functionality.
Here are the steps on how you can incorporate API integration for credit reports:
1. Identifying Your Project Objectives
Work with your stakeholders and gather requirements to formulate the project objectives. In this case, your project objective is to integrate API for credit reports.
2. Understanding Enterprise Ecosystems
Go through your existing system to determine application silos, data handling requirements, and different backend systems.
3. Identifying Possible Integration Points
You might not need to touch some of your existing systems or might need to consider future expansions. The decisions you’ll make at this point will help you choose an integration vendor. So, it’s crucial to identify the systems you need to interact with and the specific functionalities needed to be exposed from those systems.
4. Identifying Integration Capabilities
By understanding the overall objectives and the system’s digital assets, you can decide on the integration capabilities needed, such as API and service hosting.
5. Design Edge API
Frontend development teams will first interact with the edge APIs, mostly covering a specific system functionality. It will avoid backend systems from leaking complexities into frontend applications for a cleaner API design for app programmers.
6. Designing Utility And Domain APIs
After designing the edge APIs, the backend development team can design the utility and domain APIs to suit the edge APIs requirements. The edge APIs are updated if issues arise.
7. Implementing The Frontend And API Integration Logic
After designing the edge, utility, and domain APIs, the frontend and backend teams can begin implementing the system.
Faster API Integration For Credit Reports
Of course, non-technical business owners can simply embed API solutions for faster credit report access, embedding credit functionality on an existing system or website by using a lightweight restful API. In this way, you’ll have access to the following:
- Credit Scores: Ability to share credit scores with your team members to easily and quickly see customers’ creditworthiness
- Credit Reports: Ability to view, access, and share public records, payment history on the borrower’s credit accounts, and credit inquiries
Businesses Choose Soft Pull Credit Check
As a business owner or manager, you know that running credit checks may or may not affect your customers. Running a hard inquiry can stay on the person’s credit report for two years, which greatly affects the individual’s credit standing.
With API integration, conducting a soft credit check or running a soft pull credit report is easier, which is a great way to pre-qualify applicants. This process doesn’t cause impacts on the consumers’ credit.
Businesses are using a soft pull credit check to determine if their customers qualify for large purchases or specific types of loans. It helps avoid multiple inquiries on credit reports, as well as save time and money, guiding your prospects through the sales process seamlessly.
A soft pull enables brokers, lenders, and business owners to check consumer credit, pre-qualifying customers and understanding their creditworthiness. You can also review income information, liens and judgment data, and verify employment in the financing approval process.
With a reliable API solution, you can access soft pull credit reports from three major credit bureaus: Experian, Equifax, and TransUnion. You’ll have an instant view of applicants’ credit scores, hastening the credit decision process.
Conclusion
Businesses can incorporate API integration for credit reports by choosing an API solution that will tackle the complex jobs of pulling credit reports for various purposes. You can choose to integrate API to your existing systems, including your CRM and LOS, and generate accurate credit reports for seamless data processing and business workflow.
If you want to make the API integration faster, availing of a reliable API solution that offers easy-to-use API integration tools is a practical choice. This way, you can run credit checks, depending on your business needs, seamlessly.
