What Credit Past Will Affect Hiring for a Job?

Almost half of all employers require a credit check for some positions, and 13 percent of companies perform checks for any position, according to a 2010 Society for Human Resource Management survey. The major national credit bureaus sell a special type of credit report for employers. An employer credit report is almost the same thing as a regular consumer credit history.

Identification

Employers that perform a credit check almost exclusively use reports from the three national credit bureaus -- Experian, Equifax and TransUnion. A credit history for employment purposes contains data from your creditors that report to the major bureaus, usually any major bank and credit card companies. It also contains public records, such as bankruptcies and court judgments in the past seven years. The only item an employment credit check cannot contain is your age.

Why?

Companies perform credit checks because they want to weed out applicants who might be in financial straits, according to Liz Weston of MSN Money Central. A person with a bankruptcy, for example, might be tempted to steal money or just be an unstable person in general. If an employee were to steal a customer's valuables, the company could be liable for the losses for not properly investigating the employee. At the very least, credit reports tend to be a good indicator of a person's overall integrity. People who manage money well also tend to be the best employees.

Considerations

Credit checks for employment do not include a numerical credit rating. Thus an employer can only factor in specific items from your credit past. However, a credit report also contains previous employers and addresses. The employer might just pull a credit report to verify your employment history, so always be as accurate as possible about prior employers on a job application. Also, review the fine print on the pre-application screening. You must give your consent to a credit check in all cases. Unlike an check for a loan, an employment check does not harm your credit score.

Tip

A bad credit history may not necessarily disqualify you from a job that requires a background check. You should ask the employer his policy on credit checks and the general screening process. This gives you a chance to let the employer know ahead of time about credit problems, which looks better than the employer finding out about it himself. However, make sure to give a good explanation, such as a personal event like divorce or medical bills.