A background check is a tool used by certain businesses to help make a decision. The most common forms of background checks are conducted by potential employers and landlords.

To learn more about a potential employee’s background before extending an offer of employment, many employers will obtain an Employment Credit Report.  Prior to obtaining this report, the employer must request and receive the potential employee’s written permission to do so. The Employment Credit Report enables the employer to review an individual’s credit history as part of this process, however credit scores are not made available.

Landlords may use a Tenant Screening Credit Check to review a prospective tenant’s information. Like an Employment Credit Report, the landlord must request and receive the potential renter’s written permission to obtain the report and review their credit history. A credit score is made available to the landlord for this purpose.

If an employer decides not to make an offer, or a landlord denies a rental application, the law requires that they provide a notification of Adverse Action containing certain information regarding the decision, including:

  • The name, address and phone number of the agency/organization that supplied the credit report or background information;
  • A statement that the agency supplying the information did not make the decision to take the adverse action and is not able to provide any specific reasons for that action;
  • A notice of one’s right to dispute the accuracy or completeness of any information in the report and to get an additional free report from the agency that supplied the credit or other background information if it is requested within 60 days.

Both Employment and Rental Screening Credit checks are conducted as soft inquiries and do not impact credit scores.

Helpful Tips

  • The most common forms of background checks are conducted by potential employers and landlords
  • Before obtaining a credit report as part of a background check, the employer or landlord must request and receive written permission to do so
  • If a job or rental application is rejected, the law requires that the employer or landlord provide a notice of Adverse Action containing certain information regarding that decision

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