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Will a Credit Report for Employment Be a Problem?

| May 03, 2018
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Did you know that your credit history may be a factor in your job search? That’s right. When you apply for a job, your experience and interview performance may not be enough to secure the position you want. In a hyper-competitive environment, regardless of your credentials, any record of delinquent bills or overdrafts can result in a rejection.  

Why Do Employers Check Credit History? 

Employers have the right to conduct credit and other background checks on job candidates. It is becoming increasingly common for employers to use your credit report to judge your responsibility and your financial stability. With a credit report that is less than stellar, your chances of getting that plum job offer may be reduced. Employers can, with your permission, check your credit history as part of the job application process.

If you want to make sure that your credit history will not be a problem in your job search, here’s what you can do.

1. Request a Free Credit Report

You can request one free credit report each year from the three nationwide consumer credit reporting companies: Equifax, Experian, and TransUnion. It pays to check before you embark on your job search. With identity theft on the rise, it has become more important than ever to remain vigilant about your personal credit records.

To order your reports, go to www.annualcreditreport.com, or call the Annual Credit Report Request Service at 877-322-8228.

2. Carefully Review Your Credit Report

Check for any mistakes. Your report may have common errors that could negatively affect your credit score. Look for errors in any of these:

  • Wrong or misspelled name and Social Security number
  • Inclusion of someone else’s credit problems in your file
  • Incorrect balances on current credit accounts 
  • Closed accounts listed as current

Notify the issuing credit reporting agency of any errors that you find. That agency is required to reinvestigate and, subsequently, confirm, correct, or delete the information.

3. Take Steps to Clean Your Credit Report

What if your credit report reveals some genuine problems? With some planning, you may have time to repair some of the damage before you begin your job search. The negative information can be reported for seven years, but you can improve your history by paying off any outstanding debt, taking on no additional debt, and establishing a pattern of on-time bill payment.

What does financial planning have to do with your credit score? Personal financial planning is a tool that will help you successfully improve your credit rating. Contact me to schedule a time to meet. You can also find information about credit scores and reports on the Consumer Financial Protection Bureau's website.

Material discussed is meant for general illustration and/or informational purposes only, and it is not to be construed as investment, tax, or legal advice. Although the information has been gathered from sources believed to be reliable, please note that individual situations can vary. Therefore, the information should be relied upon when coordinated with individual professional advice.

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