Why run creid checks on potential employees?

[vsjhoc]

Originally Posted by sweeps

Similarly, telling me 35% of my score is based on payment history is not very useful.

Other pieces of the FICO pie are more vague, such as optimal number of credit lines, types of credit lines held, and length of credit history on each credit line.

Who is this Fair Isaac Co., and why can they determine which job I am eligible for?

There is a great deal of information freely available on what constitutes "payment history." As I suggested before, check out the education sections and discussion forums at the myfico website provided by Fair Isaac.

Fair Isaac currently has the market cornered for providing credit scores to lenders. Any other company is free to come up with its own formula and try to get the lenders to buy it. I don't see this happening anytime soon. Even if a "Pepsi" score came along, it doesn't mean that the "Coke" score would be any more willing to divulge its recipe for the drink you put in your body.

[bjl584]

My Stepfather's brother has over a million dollars in the bank, no debt, and no credit card of any kind. I don't know about his credit score, but he is unable to purchase things like Airline tickets.

[cicy33]

All he needs is a debit card with a visa or mastercard logo. We have one that we use when we need a credit card but without the temptation and hassle.

[sweeps]

vsj, we'll have to agree to disagree on the transparency of FICO. But even if we go with your assertion that anyone can find out the precise formula for maximizing their score... the point remains that FICO wasn't designed to measure your job worthiness. It's a test that's measuring the wrong thing, and innocent people are going to be hurt.

[wilsonca]

The Companies Out There Are Just Making Sure That They Are Getting Someone Reliable And Responsible. I Could See Why Some Jobs Would Want To Know That Info. I Guess It Just Depends On The Position You Are Applying For.

[vsjhoc]

Originally Posted by sweeps

vsj, we'll have to agree to disagree on the transparency of FICO. But even if we go with your assertion that anyone can find out the precise formula for maximizing their score... the point remains that FICO wasn't designed to measure your job worthiness. It's a test that's measuring the wrong thing, and innocent people are going to be hurt.

sweeps, I've never expressed my own views about whether credit scores should be used in employment decisions. I have just tried to suggest why some employers may believe it is necessary.

The use of credit scores in decision-making is becoming more pervasive in our society. Auto insurers use scores to help determine your eligibility for coverage and the amount of your premiums. So I merely advocate that we all educate ourselves as much as possible about those 3-digit numbers that have a lot of influence over our lives.

[sweeps]

From a practical perspective, yes, you should be maximizing your score because it is used for all kinds of things, credit-related or not.

My argument is more to OP's point about how most uses of FICO are illogical and unethical.

[Saving in So Cal]

Fair credit reporting laws do not just apply to what we think of as a credit check. They can, depending on the jurisdiction, also apply to certain background checks, even if those background checks do not involve any type of credit inquiry. Regardless of the kind of check being done, advance notification and consent is usually required, which is why you may be seeing this type of advisement on employment applications. You are certainly free to inquire of an employer as to what the employer's background checking process entails before you consent to the check.

[vsjhoc]

Originally Posted by Saving in So Cal

You are certainly free to inquire of an employer as to what the employer's background checking process entails before you consent to the check.

True, although many applicants feel intimidated, particularly if they want the job. Potential employer: "Why are you asking? What are you hiding?"

I had a pre-employment drug screen, and just out of curiosity I asked what they were testing for. Same reaction: "Why? What are you worried that we may find?"