Credit Check

Credit checks often occur before a lender, whether it’s a bank or credit card company, will allow an applicant to borrow money or obtain credit. During a credit check the lender will refer to a major credit agency to evaluate the credit history of the applicant who has applied to their institution for a credit card, loan or mortgage.

Credit checks are done by lenders to determine whether or not they are putting themselves at risk by lending you money. They will check for any payment defaults, unpaid bills and outstanding loans to determine if they should extend credit to you.

Credit Checks Can Give a Lender:

  • Your address
  • Your social security number
  • Your marital status
  • Your employer’s name and contact information
  • Information about previous bankruptcies
  • Information about any liens and judgments
  • Information about child support obligations
  • Your loan and credit card payment history
  • Names of other institutions who have checked into your credit history

Bad credit can not only affect whether or not you are approved for a loan or credit card, it can also sometimes determine whether or not you get certain jobs.

Credit checks are sometimes used by employers in the United States to make hiring decisions about you during employment background checks. An employer might see your credit history as an indication of how reliable you will be on the job. Some employers feel that if you cannot meet your financial obligations you may not be able to meet your professional obligations either.

The key to surviving a credit check is to remain on top of your bills and loan payments. Whenever you apply for a mortgage, loan or credit card you will likely undergo a credit check. Knowing this, before you apply you should get your finances in check.