Credit report

How your credit report can prevent you from finding a job

A well-crafted resume can make you stand out when applying for a job. The same goes for customizing your cover letter to suit the position and being charismatic during a . What many people don’t know is that your credit report can also affect your chances of getting hired.

“Any missed payments or bankruptcy could signal signs of irresponsibility elsewhere and negatively separate you from the competition,” said Jill Gonzalez, analyst at WalletHub, tells CNBC Make It.

A CareerBuilder Survey found that 72% of employers do background checks on all employees they hire, and in those cases, 29% check credit reports. Typically, employers do the checks on people who will handle financial transactions and who will be responsible for large sums of money, Gonzalez says.

Fortunately, an employer won’t check without your knowledge. They must first obtain written permission from you. And in some states, specific restrictions apply.

It also doesn’t mean that your future boss will be able to see your credit score.

“Despite the constant myth about scores and employment, there has never been a verified example of an employer having access to or using a credit score to make an employment decision,” said the credit specialist. John Ulzheimer told GOBankingRates. “This myth persists because people tend to use the terms ‘credit report’ and ‘credit score’ interchangeably as if they were the same thing. [People make] the assumption that all credit reports come with scores.”

A credit report includes information about your financial account status, payment history, and available credit, while a credit score is an assessment of your credit report that indicates your likelihood of repaying a loan. . When an employer checks your credit report, they’re looking at the big picture, not the three-digit number.

“Patterns of poor money management — like a bunch of missed payments or multiple collection accounts — could end up hurting your chances of scoring a position, especially if that gig involves handling cash, accessing to sensitive financial information, corporate accounting or government work”, reports USA Today. “That’s why it’s a good idea to review your credit reports before your job search.”

By checking for errors and correcting imperfections like a high outstanding balance, you can improve your position and hopefully put you in a better position to get the job.

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