Does Your Credit Score Show up on a Background Check?
Background checks can return all sorts of information about your past (and present) that you’d rather keep secret. But will it return your credit score?
It’s the question everyone is asking: “does your credit score show up on a background check?”
Or maybe they’re asking “what is a credit score?” or “why would I have to have a background check?”
Well, those questions and more will soon be answered for you! Buckle in, because you’re about to go on a roller coaster. A roller coaster of knowledge!
What is a credit score anyway?
A credit score is a three-digit number created from information collected by the three major credit bureaus, Experian, Equifax, and TransUnion. That information is compiled into credit reports and is fed through a formula (most commonly supplied by the FICO corporation) to create your score. That score is a number that creditors use to determine if they’re going to lend to you and at what rate.
Your credit score is made of five parts.
The largest part, your payment history, makes up 35 percent of your overall score. This is, essentially, whether you pay your bills on time. Obviously, whether or not you’ll be paying the loan back is one of the biggest, if not the biggest, factor a lender takes into account when deciding to lend to you. So whether or not you’ve paid your previous loans and other bills on time is going to be a major consideration.
Amounts owed, at only five percent less, is the next largest part of your credit score. It is an accounting of the current debts you owe, as lenders will suspect you’ll be less able to handle additional obligations if you owe a lot already. The only kinds of loans that probably won’t show up are no credit check loans like payday loans, cash advances, and title loans.
Jumping down to 15 percent, is the length of your credit history. If you’ve been handling your finances well for 10 years, that tells a potential lender a lot more than if you’ve been handling them well for six months.
The last two parts of your credit score are worth 10 percent each. One is your credit mix, which concerns the specific kinds of debt you hold. Certain debts will reflect more positively on your credit score while having no debt at all can actually be a negative. Lenders would rather see you taking out personal loans or using a credit card and paying them off in full and on time than avoiding credit at all.
The last 10 percent comes from new credit inquiries. When a potential lender performs what’s known as a “hard credit check” it will temporarily show up on your credit report. Lenders feel uncomfortable if they know you’re trying to take out multiple loans all at once. (There are exceptions for inquiries made within a certain short-term period to encourage shopping around for the best rate.) Soft credit checks, on the other hand, do not show up on your credit report.
Put all that information together, and you get your credit score. A credit score higher than 720 and you’re in great shape. Lower than 630, and you’ll be really running into trouble.
When will you get a background check?
Anyone has the ability to run a background check on you with your consent. However, most commonly a person will be asked to undergo a background check if they’re trying to apply for an apartment or a job.
If your credit score is less than ideal, you may be worried it could show up on a background check. Will an employer, a landlord, or an extremely cautious potential new friend judge you differently if a poor score shows up on the background check?
Well, you may not have to worry about that very specific scenario.
Will it or won’t it include your score?
Okay, time to stop putting off the big question you’re here to have answered. Will your credit score appear on a background check?
“In a word, no,” answered Larry P. Smith, an attorney at ProtectingConsumerRights.com. “Credit scores typically do not show up on a background check. Most background checks for employment do not seek credit information, but rather, criminal history. They are typically looking for whether you are dangerous to employ.
“Some pre-employment screenings do go deeper and look at credit. This is usually when the job requires the employee to handle money- as many states are enacting laws to prevent credit checks for employment except for certain circumstances.
“In those instances, a score may be revealed, but again, typically not. Those reports are looking to see whether the person has judgments, has declared bankruptcy, or has a large amount of outstanding debt. Credit scores really do not get revealed in background checks.”
Private investigator Lisa Ribacoff concurred: “Credit scores are NOT provided when we produce reports. We indicate to our clients that unless there is a signed authorization that we can gain access to their reports, then we are not able to even conduct the search. With our findings, we only provide the current and closed accounts as well as payment history and balances.”
So nothing at all to worry about, right? Well, just because a background check won’t turn up your actual credit score doesn’t mean the financial information that does turn up will be all smiles and sunshine.
“The credit score usually isn’t revealed on a background check,” explained Roslyn Lash, an Accredited Financial Counselor and the founder of Youth Smart Financial Education Services. “However, your credit history is more likely to show up. Even if the actual score isn’t given, a history is actually more revealing since it provides more details including dates, amounts owed, and delinquencies.”
Turning down a background check means you probably won’t get that job or apartment. So the best you can do is just work on your finances now so everything will look good when you do need to get a background check.
To learn more about your credit score, check out these related posts and articles from OppLoans:
- A Brief History of Credit Scores
- No Credit Card? Here Are 6 Ways You Can Still Fix Your Credit Score
- How Bad Credit Can Affect Your Utilities
- Yes, You Might Need a Credit Check to Rent a Car
|Roslyn Lash (@RosLash) is an Accredited Financial Counselor and the Author of The 7 Fruits of Budgeting. She specializes in financial education, adult coaching, and works virtually with adults helping them to navigate through their personal finances i.e. budgeting, debt, and credit repair. Roslyn is a Real Estate Broker and is also the founder of Youth Smart Financial Education Services which specializes in financial literacy. Her advice has been featured in national publications such as USA Today, Forbes, TIME, Huffington Post, Los Angeles Times, and a host of other media outlets.|
|Lisa Ribacoff is an Advanced Certified Polygraph Examiner and the Manager of International Investigative Group, Ltd. (@iigpi), Credibility Assessment Division. She is a member of the American College of Forensic Examiners, American Society for Testing and Materials (ASTM International). She has been featured on FUSE Media’s Web Series “Lie Detector” among many other Morning news programs and talk shows.|
|Larry P. Smith is a consumer rights attorney, concentrating his practice in the areas of Fair Credit Reporting Act and Fair Debt Collections Practices violations, as well as consumer fraud claims and lemon law. He is the Managing Partner at SmithMarco, P.C. in Chicago, Illinois.|
The information contained herein is provided for free and is to be used for educational and informational purposes only. We are not a credit repair organization as defined under federal or state law and we do not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit. Articles provided in connection with this blog are general in nature, provided for informational purposes only and are not a substitute for individualized professional advice. We make no representation that we will improve or attempt to improve your credit record, history, or rating through the use of the resources provided through the OppLoans blog.