Your Employer Wants To Check Your Credit. Now What - Money Under 30

Your Employer Wants To Check Your Credit. Now What - Money Under 30 Your Employer Wants To Check Your Credit. Now What? There is more than one reason to  be conscientious about  your credit history. Prospective employers can and often will check your credit report during a job application. When an employer runs a  background check, its both  an effort to cover the companys  backside and  stalk you a little bit before they hire you. Its  no different than when you Google a prospective date to ensure he/she is not an escaped murderer. Even though its understandable  a  company would verify job applicants  criminal histories, does an employer have any business  running credit checks on potential employees?  And could a charged off account or a  few  years of lackadaisical  bill payments  after college prevent you from landing your dream job? Heres what you need to know about credit checks during job applications and what to expect if a prospective employer wants to check your credit report. Facts about employer credit checks 1. Most  jobs wont require credit checks, but certain jobs always will. If youre a professional truck driver, you can  assume an  employer will check your driving record before offering you a job. If youre applying for  positions in banking, accounting, or law enforcement, you can assume the same thing about checking your credit report. But if youve had credit problems and are applying for any other kind of job, theres good news: Your employer probably wont check you credit report. Credit checks cost money, and most jobs simply dont carry the level of responsibilities to make your credit history relevant. 2. Employers will ask for your permission to check your credit. In order to check your credit, your employer must have your explicit  written permission. Most likely, they will ask for your permission on a form that is  part of the job application. If you fervently object to an employer checking your credit, you may  refuse your  consent, but you probably wont get the job. If you do consent, take 10 minutes  to review your own credit report so you  make sure youre as familiar with whats on there as  they will be. 3. Employers will check your credit report, not your credit score Employers could care less about your credit scorethe three digit number banks use to tell how creditworthy you are for a new loan. Employers are simply looking at your credit report, the  document that details how many credit accounts you have, how much you owe  and how diligently  youve paid those accounts on time. Factors that might lower your credit score, such as recent loan applications or  late payments, are  probably of little  interest to a potential employer. Instead, the employer will focus on patterns like  too much  debt or multiple charge offsthat indicate irresponsible behavior. How to explain your credit report to an employer For most people, an employer checking your credit report shouldnt be worrisome. Few people have flawless credit, but few people have the kind of major credit problems that would prevent them from getting a job. If youre still nervous about an employer checking your credit, consider the following: 1. Rehearse your explanations Expect wary bosses-to-be to question the questionable stuff, and have your answers ready. As you hone your responses in interview rehearsals, up your  confidence and get rid of any defensiveness. Spin past  mistakes into lessons youve learned about  overcoming  adversity. Most importantly, have explanations ready for any consistent periods of late payments. Regardless of the job to which youre applying, employers value attention to detail;  forgetting to pay  the  bills month after month does not exactly  indicate  pain-staking 2. Throw the flag Contact credit bureaus  to attach explanations of extenuating circumstances that were behind any black marks on your reports. If nothing else, the flagged entries may coax employers to second-guess any hang-ups the entries spark in their minds, and show them that you are proactive and conscientious. 3. Ask tough questions yourself If your prospective boss seems nervous about particular aspects of your past, dont be afraid to ask whats on his mind. Not only will a  tough, potentially deflating answer give you a more clear picture about your prospects, it will allow you to plead your case and change his mind. Even in the worst-case scenario, in which your credit report derails your job track, at least youll know why, and will be able to use  that information if and when it comes up again. Read More: How To Improve Your Credit Score, Step By Step Related Tools Get a Truly Free Credit Score Monitor Your Credit Daily: Start Now Our Recommended Credit Cards