Credit Reports – 2 Times You Absolutely Have to Use Them

Credit reports are practically worth their weight in gold. It’s amazing to think that a little piece of paper — with a simple three-digit number on it — can tell you so much about a person, but that’s exactly what credit reports do.

In fact, credit reports play a major role in hiring and renting. More and more people are relying on them to make important decisions, so if you’re not taking full advantage of credit reports in these two situations, you’re putting yourself at unnecessary risk:

1. During an employee background check

You may not think that good credit is that important for your employees — after all, you’re paying them, not the other way around! However, it’s important to analyze credit reports as part of an employee background check. If, for example, your potential employee has racked up a ton of crazy debts, has filed for bankruptcy, or has a few evictions under his belt, it shows that’s he’s not terribly responsible. And if someone isn’t responsible, do you really want them working for you?

It’s getting more and more standard for companies to look at credit reports during the hiring process. After all, your company’s reputation is based on the people you hire!

2. As part of tenant screening services

If you’re going to rent property out to someone, you need to make sure you’re going to get paid. If there’s even the slightest chance that you’re not, you need to find another tenant. After all, if your tenant doesn’t pay you, will you be able to afford the mortgage payments on your own? Or, will you risk defaulting on the property?
In today’s world, credit reports are the focal point of tenant screening services.

Sure, you can look at pay stubs and talk to references, but if you don’t do a tenant credit check, you don’t really know what kind of person you’re dealing with. For all you know, your tenant could have a huge salary — but is a complete spendaholic, meaning that he won’t have any money to pay his rent.

Just like in an employee background check, a tenant credit check shows just how responsible your potential tenant is. You’ll be able to see how each potential tenant handles their money, so that you can pick the best one. After all, you are going to be trusting this person to live in your house, condo, or apartment. Being responsible is crucial!

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