Sunday, February 11, 2007

Why Do Some Employers Check Credit Reports?

Financial institutions want to check a borrower's credit: to ensure he is responsible with money. Employers, on the other hand, check credit so they can make a character -based assessment of a possible employee. They can infer many things about a person based on their credit.

Profile

    Someone with a bad credit score may be seen as having a less than stellar character or have commitment issues. Some employers fear this will transfer into their work life.

Security Reasons

    Jobs on the state and federal level may check credit to determine how trustworthy an employee may be. If the job is highly secretive, an employee may be viewed as a security risk, therefore unemployable.

Money Institutions

    Companies that handle large sums of money like banks and investment firms almost always run credit checks on potential employees. They may feel that someone with bad credit may be tempted to steal while someone with great credit may not feel the necessity to steal.

Work History

    Sometimes employers may want to verify work history. A credit report can usually substantiate the applicant's claims of their former places of employment.

Considerations

    If you have spotty credit, you may want to research laws governing what an employer can and cannot use against you. You should know your credit score, and if the question arises during an interview, do not lie about it. Remember, if they decide to run a credit check on you, they have to have written consent from you.

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