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Why Employers Check Credit Score Before Hiring You?

During the interview process, employers check your credit score for background verification. Wondering Why! Employers conduct a credit check to get insights on your repayment history, amounts you owe and available credit. This gives an insight into how well you manage your finances without having any negative records such as late payments, bankruptcies, etc. Having an evidence of mishandling your own finances will indicate a negative side of your credit. Also, taking lots of credits or having excessive debts might indicate some fraud activities. That is the reason, it is always important to frequently check your credit score and maintain a good credit rating to avoid it from affecting your potential job opportunities.

What is a Credit Score?

A credit score represents your credit behavior and ranges from 300 to 900. The score is generated by major credit bureaus such as Equifax, Experian, TransUnion, CRIF High Mark by considering various factors such as payment history, credit mix, outstanding debts, amounts owed, etc.

Having a high score above 750 shows that you have made your repayments on time and maintained a good credit history. Moveover, you can get your personal loans approved at low interest rates when you have a good credit rating. Therefore, to keep a track of your credit history, you can check credit score using Buddy Score and get a whole credit report instantly.

Why Do Employers Conduct A Credit Check?

The following are the reasons why employers check your credit score before hiring you.

  • Employers check your score because it is a part of background verification to check how well you manage your finances.
  • To assess your personality traits such as reliability and trustworthiness which is shown by your payment history.
  • To ensure that you have not been involved in any illegal activities.

Prepare Yourself for a Credit Check Before Employment

  • Check your credit score and your credit report before applying for a job to get an insights about your Repayment History Information (RHI)
  • Repayment History Information (RHI) contains both present and missed payments in your credit report.
  • Review your credit report regularly to resolve any potential errors which may affect your credit score.
  • Improve your credit score by making payments on time and clearing your outstanding debts.

Quick Tips to Improve Your Credit Score

Here are a few quick tips to help you improve your credit score.

  • Review your credit report regularly at least once a year. If you find any errors, report it immediately to the respective credit bureau and get it rectified immediately.
  • Repay your loan on time period without defaulting throughout your tenure.
  • Clear all your pending and unpaid debts as early as possible.

EndNote

Employers have started giving more importance to the financial behaviour of an employee as it shows how reliable you are. So they conduct a credit check before hiring you. Hence, you have to maintain a good credit score as it has an impact on your employability when you apply for a job. Buddy Loan is an online financial service platform. It helps you to check credit score for free anywhere, anytime in minutes. With a wide range of credit scores from various lending institutions, you will get an idea about borrowing capacity before applying for a loan and make the decision. Buddy Loan will help you identify your financial goals and assist you to achieve them by providing the best lenders. The whole process takes less than 5 minutes! You can find out your Experian Credit Score with us, for free.

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