What Are Credit References? [Full Guide for 2024]


When looking for a new place to live or taking out any kind of business or personal loan, one of the most important things your potential landlords or lenders will ask you to provide is a credit reference. But what are credit references, where to get one, and where are they used? Who can you use as a reference, and what kind of information do they need?

In this blog post, we’ll answer all these questions and more to help you feel more confident about the topic and make a wise decision regarding your credit reference!

What Are Credit References?

A credit reference is an individual or business that can vouch for your financial history by providing information about your ability to repay debts, and whether you’ve ever missed a payment or been late on rent. A credit reference can be either personal or professional—you could use a friend or family member as a personal reference, or use credit bureaus, previous landlords, or employers as a professional reference.

A credit reference reduces the risk of the lenders, enabling them to determine if you’ll be able to pay back the loan based on the information provided in the reference. If you’ve paid previous loans on time, lenders will readily give you a loan. However, if your credit references suggest you have a history of missed payments, have previously defaulted on loans, or have outstanding debts, it will make the lenders cautious about lending you the money, as it will make you a liability.

But if you don’t have a good credit history, don’t worry—it’s possible to fix your credit score and even get out of debt even if you have no money or good credit. Once you start making timely debt payments, your credit history will improve, and you’ll be able to get a positive credit reference in no time!

Where Are Credit References Used?

They’re used when you’re looking for a loan or a new place to stay. Here are some of the most common situations where a credit reference is needed:

Rental Applications

A credit reference is an important document if you’re looking for a new place to stay. While some allow you to rent an apartment without credit, most landlords will require you to provide a credit reference when you apply for a new lease. They’ll use this information to get an idea of your financial history and credit score, verify your income and employment history, and make sure you’re able to pay your rent on time.


Just like you need a credit reference on a rental application, you’ll need one for a loan application as well. Loan applicants can be individuals as well as a business, and references are required for both. So, whether you need a loan to buy a car or to invest in your business, make sure you have a credit reference.

For a business loan, start by building your business credit that will help lenders determine if you’ll be able to make timely payments. If you have a good credit history and references, you can use these to negotiate better loan terms as well—lenders will likely reduce the interest rate if you have solid references and good credit history.

Utility Service

This might come as a surprise to many, but apart from credit references for a rental application, you also need references for utility services. When setting up utilities like electricity, water, phone services, and gas upon moving into a new home, many utility companies will require you to provide a credit reference first, preferably from your previous utility company, to ensure you’ll pay your bills on time.

Credit Cards

If you’re applying for a credit card, the credit card companies will likely ask for a credit reference to verify your income and employment history, and make sure you’re able to repay the debts you charge on the card.

DID YOU KNOW: A letter of reference is also required when a credit application from a foreign country wants to do business in the US and requires a loan for the same.

Who/What Can I Use as a Credit Reference?

By now it should be clear that regardless of the type of loan you’re looking for, a credit reference plays an important part in getting approved. Here are some companies or individuals that can give you a credit reference:

Credit Bureaus

A credit bureau is a government-regulated financial institution that keeps track of your credit history to provide a credit report, including how many loans you have or how regular your payments are. Credit bureaus also allow landlords to report a tenant if they fail to make regular payments.

If you’re applying for a loan or require a credit reference for renting, your lender or landlord may ask for your permission to access your credit report. Credit reports are a trustworthy reference, and most lenders consider them a standard part of the lending process.

Utility Company

If you’ve been a customer of a utility company for a long time, they may be able to provide information about your payment history and if you were able to pay for utilities every month, which you can use as a reference when applying for new utilities.

Previous Landlord

If you need to supply a credit reference for an apartment, your previous landlord can help by providing information about your rental history and how regular you were with your payments. Most landlords make it compulsory to get a reference from the previous landlord, as it helps them analyze if you’ll be a good tenant.

Previous Employer

Character references from previous employers are also a good credit reference, as they can attest to your character and values, thereby confirming your creditworthiness. Character references can also be used to verify your employment history and income, and they’re especially suitable for people without a long credit report or those looking for a loan for the first time.

Asset Documentation

By now, you must have a clearer picture of what is a credit reference and what is included in it, but you should know that asset documentation can also serve as a reference. This is a good option for businesses and property owners looking for a loan, as it provides information about your assets that the lender may not have access to, such as bank statements, investment portfolios, and tax returns. Asset documentation can provide a better financial picture and make the lenders approve your loan application.

Credit Rating Agencies

Credit rating agencies are private companies that keep track of your borrowing history. If you’re applying for a loan or a credit card, your lender may ask for your permission to access your credit report from one of these agencies.

Personal References

Finally, credit references for renting can also include personal references. If you have a friend or family member willing to vouch for your financial responsibility, they can write a documented letter of recommendation to be used as a reference when you’re applying for a new lease or a loan. However, its level of effectiveness is low compared to all the other references.

DID YOU KNOW: You should save references from credit bureaus or utility companies for major loans like mortgages, as these have the highest level of effectiveness.

Key Takeaways

A credit reference plays an important role in applying for a loan or looking to rent a new property, yet many people don’t know what’s a credit reference.
A credit reference vouches for your ability to pay the rent or the loan amount back on time, helping the lenders determine your creditworthiness.
References are required even when you’re applying for credit cards and utility services.
Credit bureaus, previous landlords, utility companies, and previous employers can provide you with a credit reference.
You can also use asset documentation, credit rating agencies, and even personal testimonials from friends and family as a reference.

Credit Reference Example

A credit reference may look different for different types of loans. It’s important to ask your lender what kind of information they need to avoid going back and forth with them. Let’s now take a look at what a basic credit reference looks like, as it’s not uncommon to get confused about the format and what details to mention in it.

Example 1

Here’s a sample credit reference from a credit bureau:

Name: John Doe

Address: 123 Main Street, Anytown, USA

Phone number: 555-555-1212

Email address: john.doe@example.com

Date of report: January 2010 – December 2012

Bureau credit score: 750

Findings: The applicant has a good credit history and always pays their debts on time. I would recommend them for any credit products they are applying for.

Example 2

Here’s a sample credit reference for an apartment application from the previous landlord:

Name: Mary Parker

Address: 123 Main Street, Anytown, USA

Phone number: 555-555-1212

Email address: Mary.parker@example.com

Relationship to the applicant: Previous landlord

Dates of tenancy: January 2018 – December 2020

Rental history: The applicant was a model tenant and always paid their rent on time. I would recommend them to any landlord.

Example 3

Here is another personal credit reference example from a relative or a friend in the form of a documented letter.

Dear [Name of lender or landlord],

I am writing to recommend my friend, Emma Ross, for a loan/lease. I have known Emma for many years and can attest to their financial responsibility. They have always paid their debts on time and I am confident they will do the same with any loan/lease they are approved for.

Thank you for your time,

[Your name]


A credit reference is important when you’re applying for a loan or looking for a rental place, yet many people do not know what a credit reference means. There are many different types of references that help verify your income and employment history and ensure you’ll repay the debt, including credit bureaus, utility companies, previous landlords, and employers.

Asset documentation and letters of recommendation can also be used as a credit reference. When choosing a credit reference, make sure to pick someone who you have a good relationship with and who you trust to provide accurate information about your financial history.


What do I put for a credit reference?

You can put credit bureaus, utility companies, previous landlords, and employers as credit reference, but many also put asset documentation and personal references from friends or family.

What is a credit reference example?

Anyone who’s had a financial relationship with you can be a credit reference. Some examples include credit bureaus, previous landlords, employers, utility companies, and even credit rating agencies.

What is the role of credit reference?

If you know what are credit references, you must be aware they’re crucial in the vetting process, helping lenders determine the creditworthiness of the loan applicants. A good credit reference makes it easy for the applicant to get approved, as it shows they’re able to pay their dues back on time.


I learned a lot about finance after working for a digital marketing company specializing in investing and trading stocks, forex, etc. After that, I got exposed to other verticals such as wealth management and personal finance, which further improved my understanding of the financial world.

Latest from Ace

How Much Does a Surety Bond Cost in 2024 What Are Variable Expenses & How to Save on Them All Types of Bonds Explained (The Ultimate Guide for 2024) What Is Asset Management? [2024’s Full Guide]

Leave a Reply