Pre-employment credit checks (1 Viewer)

KardiacKat

Very Banned
Joined
Mar 23, 2009
Messages
12,933
Reaction score
6,122
Offline
I have noticed on several jobs I've applied for that they do a pre-employment credit check. I never thought of it before, but recently my friend who is a bank manager told me that every time your credit is "pulled," it affects the score. Too many and you can lose points. The more I thought about it, the more I also thought that it really isn't anyone's business what your credit score is or to whom you owe money. I can understand why an employer might think a credit report is something they'd like to see. A person with good credit and good payment history would seem to be a reliable potential employee. A person who doesn't might not be. But in this troublesome economy, many people might have taken a hit on their credit score due to late payments that they simply couldn't control due to a job loss, layoff, or even due to a serious illness or other cause. In other words, a lower score might not mean you are unreliable at all but simply had a run of bad luck. So overall, I don't think I approve of this practice and I'm not sure why a person should be able to require it of applicants. Thoughts?
 

buzd

party lamp
Staff member
Tech-Admin
Joined
Jan 11, 2002
Messages
33,887
Reaction score
29,183
Location
Duncan Plaza
Offline
Not true. These are soft checks that don't affect your score (we do quite a few of them).

And it is relevant to certain positions - positions with any kind of financial responsibility (from handling cash to ordering to a/p processing, etc). If someone is heavily in debt, has lots of open collections, etc it can certainly be indicative of a motivation to steal and/or act improperly. It can also be reflective of the candidate's sense of responsibility, commitment to obligations, etc.

These checks require the consent of the employee being checked, so if they don't like it , they don't have to agree to it. While I definitely think that that pass/fail standards need to be set beforehand so employers can't just use them to "peek" into an employee's financial history, there is a lot of room for interpretation of mitigating circumstances (medical collections b/c of slow insurance companies, bad credit from a divorce situation, etc). There's a lot of potential for abuse there. I also think that they should be used in conjunction with a thorough background check.
 

Mr. Blue Sky

Still P***ed at Yoko
VIP Contributor
Joined
Jun 6, 2006
Messages
24,924
Reaction score
14,660
Location
Between the Moon and New York City
Online
And it is relevant to certain positions - positions with any kind of financial responsibility (from handling cash to ordering to a/p processing, etc). If someone is heavily in debt, has lots of open collections, etc it can certainly be indicative of a motivation to steal and/or act improperly. It can also be reflective of the candidate's sense of responsibility, commitment to obligations, etc.



Bull****.


the credit scoring system is a scam, and Equifax, Experian, TransUnion, FICO, etc. are all in on it... it is purely a money-making scheme that is prone to many, many errors... i was turned down for a job about ten yrs ago b/c my credit score wasn't high enough; they called me a couple of months later and offered me the job anyway though.. it hasn't really affected me much since then, but i do see the effect it has on others, and i've seen many errors in my own credit reports.
 
OP
KardiacKat

KardiacKat

Very Banned
Joined
Mar 23, 2009
Messages
12,933
Reaction score
6,122
Offline
These checks require the consent of the employee being checked, so if they don't like it , they don't have to agree to it. While I definitely think that that pass/fail standards need to be set beforehand so employers can't just use them to "peek" into an employee's financial history, there is a lot of room for interpretation of mitigating circumstances (medical collections b/c of slow insurance companies, bad credit from a divorce situation, etc). There's a lot of potential for abuse there. I also think that they should be used in conjunction with a thorough background check.

But if you don't consent, are you disqualified from consideration? You really have no choice when you need a job. You gotta open yourself. And the bold text is something that I wonder about...

Thorough background check accompanying such a credit check would yield a more accurate picture, but again I have to wonder how much personal business an employer has the need or right to know? I know people who do their jobs like a champ but have some effed up personal life situations. What really matters in terms of doing the job?

Bull****.


the credit scoring system is a scam, and Equifax, Experian, TransUnion, FICO, etc. are all in on it... it is purely a money-making scheme that is prone to many, many errors... i was turned down for a job about ten yrs ago b/c my credit score wasn't high enough; they called me a couple of months later and offered me the job anyway though.. it hasn't really affected me much since then, but i do see the effect it has on others, and i've seen many errors in my own credit reports.

What I'd like to know is, why do you have to pay to see your own credit score? It does have a certain "scam" quality to it.
 

mikaloyd

minion_patriot_drinker
Joined
Jun 13, 2009
Messages
14,743
Reaction score
9,066
Location
Oildale CA
Offline
Bull****.


the credit scoring system is a scam, and Equifax, Experian, TransUnion, FICO, etc. are all in on it... it is purely a money-making scheme that is prone to many, many errors... i was turned down for a job about ten yrs ago b/c my credit score wasn't high enough; they called me a couple of months later and offered me the job anyway though.. it hasn't really affected me much since then, but i do see the effect it has on others, and i've seen many errors in my own credit reports.

Yeah! Get rid of all credit scores! What kind of world do we live in when we cannot trust men to repay money on their word alone instead of their history at repaying debt? Oh thats right, the REAL world.
 
OP
KardiacKat

KardiacKat

Very Banned
Joined
Mar 23, 2009
Messages
12,933
Reaction score
6,122
Offline
Yeah! Get rid of all credit scores! What kind of world do we live in when we cannot trust men to repay money on their word alone instead of their history at repaying debt? Oh thats right, the REAL world.


I don't think that's what he means. I think he's challenging the arbitrary "score" aspect of it, as well as these handful of exclusive entities which control that. Given the errors I hear reported on credit reports all the time, there is plenty of reason to question the accuracy as well as the process for establishing a score. But my question is still this: What does someone's personal financial business with their bank have to do with their ability to do a job? Maybe nothing at all. And exactly how much explaining should a job candidate be forced to do if there is some blemish on their report?
 

mikaloyd

minion_patriot_drinker
Joined
Jun 13, 2009
Messages
14,743
Reaction score
9,066
Location
Oildale CA
Offline
I don't think that's what he means. I think he's challenging the arbitrary "score" aspect of it, as well as these handful of exclusive entities which control that. Given the errors I hear reported on credit reports all the time, there is plenty of reason to question the accuracy as well as the process for establishing a score. But my question is still this: What does someone's personal financial business with their bank have to do with their ability to do a job? Maybe nothing at all. And exactly how much explaining should a job candidate be forced to do if there is some blemish on their report?

If you were hiring me to work for you, and your livelihood depended upon me being honest and trustworthy and to make good decisions for you...how much would you want to know about my character before hiring me?

heres another question, do you really want to work for an entity which you feel is too far into your personal business? If this is a big issue for you then you would probably be better off working for someone whose application process is less intrusive and harmful to your situation. Because if you feel used and abused after applying for work at a place of business I can almost say with 100% certainty that you would hate working there. They wont change and neither will you. Consider their credit check requirement a deal breaker and move on to happier greener pastures.
 

redlandssaintsson

Fan By Blood
Joined
Jan 28, 2007
Messages
5,300
Reaction score
1,905
Location
Redlands
Offline
Here's my problem. When you're young, and prone to mistakes (ME!) bad things can happen quickly and then you're screwed forever. I'm not so much with the crap score for life.
 

buzd

party lamp
Staff member
Tech-Admin
Joined
Jan 11, 2002
Messages
33,887
Reaction score
29,183
Location
Duncan Plaza
Offline
Bull****.


the credit scoring system is a scam, and Equifax, Experian, TransUnion, FICO, etc. are all in on it... it is purely a money-making scheme that is prone to many, many errors... i was turned down for a job about ten yrs ago b/c my credit score wasn't high enough; they called me a couple of months later and offered me the job anyway though.. it hasn't really affected me much since then, but i do see the effect it has on others, and i've seen many errors in my own credit reports.

The soft reports that we (and are usually) run aren't FICO scores like you would get when you are applying for a mortgage. It's more a summary of good/bad accounts, credit limit, payment history, etc. You are correct - it's often not accurate, because it's purely at the discretion of the creditors what and how much to report. That's why there's a certain amount of room for interpretation. The reports also indicate if any of the items are disputed, whether an account is closed etc.

FWIW, we use Equifax.

But if you don't consent, are you disqualified from consideration? You really have no choice when you need a job. You gotta open yourself. And the bold text is something that I wonder about...

You absolutely have a choice whether to consent or not. And private employers have a choice on who to hire and what the requirements of a position are.

And in the case of a divorce, yes, I have seen situations where an estranged spouse has ruined someone's credit in pretty excessive ways. Still, it's their credit - it's their responsibility to protect it. Sucks, though.



Thorough background check accompanying such a credit check would yield a more accurate picture, but again I have to wonder how much personal business an employer has the need or right to know? I know people who do their jobs like a champ but have some effed up personal life situations. What really matters in terms of doing the job?

Background checks are complicated, because there is no central clearing house for court records, and there are plenty of things to check: federal, state, parish, or municipal? Felony or misdemeanor? Only areas of past residence? If I've lived in LA my whole life, why would someone check my background in CA? Or Utah? Or wherever? It can get very expensive very fast, and still not be complete.

Credit checks are compiled and easy to check. Background checks are not.

What I'd like to know is, why do you have to pay to see your own credit score? It does have a certain "scam" quality to it.

You are entitled to a copy of your report whenever it is checked, and directly from the reporting agencies once a year (I think). The scam comes in with third party agencies (freecreditreport.com) which offer to provide that service in conjunction with other (scam) protection services.

Ultimately, credit checks do cost money, because maintaining those databases and credit services is their business. But there are ways to monitor your credit for free.

Here's my problem. When you're young, and prone to mistakes (ME!) bad things can happen quickly and then you're screwed forever. I'm not so much with the crap score for life.

You're not screwed forever. Credit checks go back roughly 7 years, and items fall off after that (from when they are closed/resolved). You can contact the credit agencies and creditors to accelerate that process (usually with varying levels of success). With some diligence, a credit score can be significantly improved in a matter of several months.

You also have control over your own credit in that you can freeze issuing new credit, hide your credit report from being checked, etc. Obviously, this may cause you other problems in the short and long run.
 
OP
KardiacKat

KardiacKat

Very Banned
Joined
Mar 23, 2009
Messages
12,933
Reaction score
6,122
Offline
The soft reports that we (and are usually) run aren't FICO scores like you would get when you are applying for a mortgage. It's more a summary of good/bad accounts, credit limit, payment history, etc. You are correct - it's often not accurate, because it's purely at the discretion of the creditors what and how much to report. That's why there's a certain amount of room for interpretation. The reports also indicate if any of the items are disputed, whether an account is closed etc.

FWIW, we use Equifax.



You absolutely have a choice whether to consent or not. And private employers have a choice on who to hire and what the requirements of a position are.

And in the case of a divorce, yes, I have seen situations where an estranged spouse has ruined someone's credit in pretty excessive ways. Still, it's their credit - it's their responsibility to protect it. Sucks, though.





Background checks are complicated, because there is no central clearing house for court records, and there are plenty of things to check: federal, state, parish, or municipal? Felony or misdemeanor? Only areas of past residence? If I've lived in LA my whole life, why would someone check my background in CA? Or Utah? Or wherever? It can get very expensive very fast, and still not be complete.

Credit checks are compiled and easy to check. Background checks are not.



You are entitled to a copy of your report whenever it is checked, and directly from the reporting agencies once a year (I think). The scam comes in with third party agencies (freecreditreport.com) which offer to provide that service in conjunction with other (scam) protection services.

Ultimately, credit checks do cost money, because maintaining those databases and credit services is their business. But there are ways to monitor your credit for free.



You're not screwed forever. Credit checks go back roughly 7 years, and items fall off after that (from when they are closed/resolved). You can contact the credit agencies and creditors to accelerate that process (usually with varying levels of success). With some diligence, a credit score can be significantly improved in a matter of several months.

You also have control over your own credit in that you can freeze issuing new credit, hide your credit report from being checked, etc. Obviously, this may cause you other problems in the short and long run.

this is very good information. and one thing i would note is what you said about it being up to the discretion of creditors what they report. i am changing banks very soon because i recently learned that the bank i have used all these years never reports "good" things. their policy is only to report a missed payment or default. they never report good payment history. i learned that from two sources. one is my friend at the other bank because he used to work for my bank. the other is my sister, who has taken out a handful of small loans over the years to build a credit history and there is no evidence of it anywhere. because they didn't report.
 

Mr. Blue Sky

Still P***ed at Yoko
VIP Contributor
Joined
Jun 6, 2006
Messages
24,924
Reaction score
14,660
Location
Between the Moon and New York City
Online
Yeah! Get rid of all credit scores! What kind of world do we live in when we cannot trust men to repay money on their word alone instead of their history at repaying debt? Oh thats right, the REAL world.



dude, chillax with the attitude.. We're trying to have an adult conversation here.


i'm not opposed to credit scores and reports in theory... if these were reputable companies with sound practices, i would agree with you that we do need some type of system to determine who is credit-worthy and likely to pay back their loans... but do you have any clue as to how time-consuming and tedious it is to get an error corrected on your credit report?? Something that you had ZERO to do with in the first place??? It just isn't right.
 
OP
KardiacKat

KardiacKat

Very Banned
Joined
Mar 23, 2009
Messages
12,933
Reaction score
6,122
Offline
Best Credit Score to have = 0

Cash is king.

That's fine in Utopia, where you live, but most of us have to deal with credit of some kind when buying a house or a car and other major purchases. Most people have a credit card because you can't even book a hotel or rent a car without one. I would agree it is best to make every possible purchase with cash, but you can't do that for everything.
 

efil4stnias

Play at your own risk
Joined
Jul 9, 2001
Messages
34,619
Reaction score
34,673
Location
Covington
Online
Here's my problem. When you're young, and prone to mistakes (ME!) bad things can happen quickly and then you're screwed forever. I'm not so much with the crap score for life.


not so. it takes about 7 years for stuff to fall off your record. What you need to do now is establish what credit you can, make sure to pay on time and keep open, revolving acct balances as low as you can relative to the credit line.

I too had the same problem in college. Got my first CC at 22 with a credit line of $2200. Went hog wild. defaulted and didnt have a decent score until i was 30. Then worked from there to establish my credit as quickly as I could.

fairisaac.com- has many tips on how to repair....

/threadjackover.

As for the credit scoring on personnel, I can understand it fully. As to the validity or accuracy, you need to be proactive and check not only your score but the print out of what accts you have attributed to your name. At least once a year - I enrolled in a program that sends me quarterly reports so that I may keep tabs- I was a victim of identity theft when I was 19 and that took almost 2 years to clear up. ( and it wasnt so much theft as it was a guy in Georgia was 1 digit off on his SSN and the hospital charged me based on the SSN - gall bladder surgery that was $71,000 )
 

Taurus

More than 15K posts served!
VIP Contributor
Joined
Dec 20, 1997
Messages
26,262
Reaction score
16,369
Age
53
Location
Yacolt, WA
Offline
Bull****.


the credit scoring system is a scam, and Equifax, Experian, TransUnion, FICO, etc. are all in on it... it is purely a money-making scheme that is prone to many, many errors... i was turned down for a job about ten yrs ago b/c my credit score wasn't high enough; they called me a couple of months later and offered me the job anyway though.. it hasn't really affected me much since then, but i do see the effect it has on others, and i've seen many errors in my own credit reports.

Amen, brother. The calculation methods are secret, so nobody on the planet outside of the Big Three knows what the hell your score is supposed to be. So they can just pull a number out of their *** and you have to live with it.
 

Jeff Miller

Shaw 1988, NYIT 2009
Joined
May 27, 2002
Messages
18,511
Reaction score
9,040
Age
51
Location
Vancouver, WA
Offline
Thoughts?

I refuse to sign any request for consent for a credit check form for a perspective employer. Such infomration has nothing to do with the job a person does and don't want to work for anyone who makes employment decisions on such a poor indicator.

You can be a fantastic employeee, but a divorce can ruin your credit. IMO its nothign more than Human Resource lazyness.
 

Create an account or login to comment

You must be a member in order to leave a comment

Create account

Create an account on our community. It's easy!

Log in

Already have an account? Log in here.

Users who are viewing this thread

 

New Orleans Saints Twitter Feed

 

Headlines

Top Bottom