Do Employers Check Your Credit Score?

Do Employers Check Your Credit Score?

Today’s employers assess applicants based on their experience, skills, and attitude. There are many jobs where employers reach a decision depending on what they see on the candidate’s resume and what transpires during the interview. However, there are some instances when your credit also has an important role to play in your job search.
While potential employers cannot really check your credit score per se, they can still get access to a version of your credit report then use it for evaluating your judgment and if you might pose any financial risk.
Interviews are already stressful so being aware of what potential employers can and cannot know about you through a credit check can ease away one of your worries.

Can an Employer See Your Credit Score?

Prospect employers cannot really see your 3-digit credit during a job application. But, they can still see a credit report version that is different from the version that potential lenders can see. What they can check is the modified report that doesn’t include information like your account numbers, date of birth, details regarding your spouse, or others that may possibly violate the laws on equal employment.
Since the purpose of your credit score is to show a lender if you are worthy of credit or not, it is not something that potential employers will use to reach a hiring decision. Therefore, it is not part of the report that they can see.

What Can Employers See on Your Credit Report?

That modified credit report accessible to potential employers will only disclose personal details like your name, Social Security number, and address. This will contain details regarding your incurred debt such as your credit card debt, mortgage, student loans, and your history of payment of these debts.
Why would potential employers be interested to get access to your credit report, then? Employers may do it for various reasons. If money management is involved in the job, a credit report might show a lack of financial responsibility. This might also show financial distress that can increase the risks of theft or fraud.
By checking off prospective employees with some red flags on credit, employers can lower the risks associated with the hiring process. In the event that the credit report reveals numerous late payments or anything more serious, employers may perceive it as an indication that the applicant has less than satisfactory organizational skills.
It is imperative for employers to seek the applicant’s consent first before they can run the person’s credit. If the applicant is not hired based on the details revealed in the credit report, it is required by the Fair Credit Reporting Act to inform the applicant and be given the chance to dispute the details.

The Bottom Line

Basically, a credit report can help potential employers in evaluating how responsible and trustworthy you are as an employee. It especially comes in handy if you are applying for a job wherein you will be required to manage financial details or work with the sensitive data of customers.