Chris J Anderson asked:




The credit check is very important step for back ground check in HR. The credit worthiness of some candidate can have significant importance in the decision of hiring especially if there is some unexplained area. The access of credit check is however not that easy, there are easy to understand legal requirement regarding the privacy of person to protect the personal credit history. The request to bank for credit check can include the following documents.

1- Request for obtaining Credit Report
2- The key information (simple or comprehensive report)
3- Permission for obtaining the credit report (endorsed by the future employee)

The legal requirements for the check in case of employee assessment is that the person should endorse in writing the request for the credit report. The reason for issuance of this information might be to obtain the honesty and credibility of the future employee. The bank however should provide the partial credit information not the complete credit history of employee.

If some decision like promotion is done based solely on the report, the legal requirement is there to disclose that information to the employee. This will automatically give him the right to challenge if he is not satisfied.

There are some cases where the other person can easily have the access to the personal information especially the credit reports; these include the case where the person might have given the power of attorney to bank for obtaining it. The minor, children and legal hires can obtain the credit reports, the procedure will be to send a request with due documents attached stating the reason of obtaining this information.

The exceptional cases for obtaining of the credit report can also include the credit report relating to some transaction to assess the credit worthiness, for example the credit checks done for the re mortgage or credit debt settlement cases.

Another similar situation where the credit can be requested is in case of insurance, or assessment for credit worth for underwriting purpose. This request is normally provided to the bank with due reason, so in return the bank shares the particular information with the insurance company or the other financial institution involved.

The eligibility of someone for obtaining some official benefit can also be attached to it. The government benefits and licenses are some times attached to certain income groups, as the result the agencies responsible for dispersal of these benefits can ask for the credit report too.

Elaine

Adam Tijerina asked:




You know you have personal credit reports and credit scores, but were you aware that if you run a business, you also have a business credit report and score? If you run a small business, find out why it is important to access your own reports and those of your customers, vendors and suppliers and how that information can affect whether or not you get access to an increased credit line or more stringent credit terms for your company.

Your small business credit report and score can indicate to a potential customer, vendor or supplier your credit worthiness and can have factor in the what kind of credit terms you get or if you get any financing at all. They will see how many accounts you have opened, how many of those accounts are past due, the average amount you owe, and whether you have ever been past due on any of your accounts.

You can also get access to public records such as bankruptcies, judgments, liens, alternate company names and other DBAs all on a small business credit report.

All this information is then compiled and given a credit risk score by Equifax which can indicate how likely a company will fall behind over 90 days on their bills or result in a charge off over the next year. Wouldn’t this information be useful in deciding on who to do business with?

Equifax also provides a business failure score which can predict how likely a big business will fail and have to file bankruptcy over the next year.

There are no free business credit reports as their are with personal credit reports. You can chalk up the cost of this information as a cost of doing business which can save you thousands of dollars by going with a responsible vendor or supplier or new customer who will not default on their payments.

Buying small business credit reports and scores can help you make smart decisions about who you decide to do business with and can prevent you from working with an unreliable customer, vendor, or supplier who has a lousy payment history and keep your cash flow low.

Allison