You know that lenders can see your credit score, but what about your potential employers? While they can look at your credit history, your credit score remains private. Moreover, your credit report is different from your credit score. This is what we learned after researching extensively and looking at a series of reputable sources, including UnMask. In this article, we will look at this difference in more detail, as well as other issues relevant to your credit score.
Your Credit Report
Your credit report contains your balances, credit card account information, credit available, and other components of your credit history. All of that information is summarized in a 3-digit number, which is your credit score, which can range from 300 to 850. To be considered good, your credit score should be 700 or above. Most people’s scores range from 600 to 750, while a credit score over 800 is considered excellent.
So why would an employer care about your credit? Credit reports can verify your background, identity, employment history, and education. They can even help prevent financial crimes. Most employers use them to get a general impression of how a potential employee deals with their responsibilities. Moreover, accessing your credit report can provide other information to your potential employers – such as your financial situation and any potential problems. When hiring employees for finance-related positions, employers usually find these attributes quite important.
All About Undergoing A Credit Check
You’re not likely to undergo a credit check if you’re not applying for a job in or related to finance. Even if you are, your credit will be the last thing that’s checked. Since running a credit check requires time and money, most companies outsource them to third parties.
When checking your credit, employers will see the same information that would be available to a potential lender, with the notable exception of your score. In addition, they won’t see your birthdate, either. Although employers and loan providers typically have much of the same credit report data, employers also carry out an in-depth background check report that also includes your insurance, previous jobs, and legal activity.
In addition, your potential employer will see your student or car loans, mortgages or other open lines of credit, missed payments, late payments, foreclosures, accounts in collections, and bankruptcies. Needless to say, your credit score will not be impacted by your credit check, and your employer will not be able to see it.
Employment background check inquiries are considered “soft inquiries.” In other words, they do not impact systems of credit scoring and aren’t visible to third parties. As a result, only you and the potential or current employer would see the results of an inquiry. Typically, employers evaluate candidates depending on their long-term credit history. In contrast, lenders will look at your most recent history, going back four years ago or less. If there were issues in your credit history from four to seven years ago, an employer might ask about them.
An employer might not be able to see your credit score, but there are things a seasoned interviewer can pick up on even without running a background check. Specifically, your behavior during the interview can reveal a lot about you. Your resume can be telling. For example, let’s say you have some employment gaps. Although having some gaps is normal, having too many of them might indicate that a candidate has trouble getting or keeping jobs due to their personality or performance problems.