Applying for a new job can be stressful, and many people expect to have nearly every part of their professional lives examined when they begin the application process. In recent years, however, more and more people have been surprised to learn that many potential employers are checking their personal credit histories.
The reasons that companies give fro doing this are varied. Many of them claim that an employee’s personal credit history is an indication of how well they will make financial decisions for the company. Other companies believe that a potential employee’s credit score is an indication of their ethics and honesty. Nonetheless, it is important for any job applicant to know what to expect when a potential employer asks for permission to pull his or her credit history. To start, it is important to know that an employer must ask for permission. While a company is allowed to no longer consider a person for employment if he or she does not give this permission, it is necessary for a potential employee to give written permission to pull a report. It should be noted that getting a credit report will only reduce your credit score by one or two points.
After an employer pulls your credit report, it is important to know what they can and can’t use the information to do. For example, the law states that an employer is not allowed to discriminate against any potential employee because he or she has filed for bankruptcy. Furthermore, if the information in the credit report is used to deny you a job, the employer must notify you of this in writing.
In general, most employers who request credit checks are simply making sure that a potential employee does not have too much debt. This usually means that employers want to be sure that a new employee will not be tempted to steal money from the company or be hounded at work by debt collectors. The vast majority are not interested in information about late payments or even foreclosures.
Nonetheless, it is generally a good idea for anyone who is looking for work to pay very close attention to their credit score. Make sure that all bills get paid on time, and try to keep the balances on your credit cards and other revolving debt low.