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Employment

Is Employment Listed in Your Credit Report?

When you look over your credit report, you may be surprised to see not just your current job listed, but a few past workplaces too. So, what does your job history have to do with your credit history and why is it on your credit report? To put it simply, knowing your employer helps lenders verify your identity and assess your risk as a borrower.

Here's the reason the names of your employers can appear on your credit reports, as well as the impact that information may have.

Why Your Employment Is in Your Credit Report

You may assume that your bosses have been independently sending information about you to the credit reporting agencies, but that's not the case. In fact, an employer is on your report because you provided that information on an application for credit.

The paperwork for loans, credit cards and finance companies typically have a field for you to submit information about your job. The amount you earn, where you work and how long you've been with the company are relevant for the qualification process. To properly analyze risk and whether you can afford to pay back the loan or line of credit, the lender will need an accurate picture of your financial situation and source of income.

Once the lender has received your completed application, it will notify the credit reporting agencies with certain details about you, which can include the employer you listed. There is no requirement that the lender supply that information to the credit reporting agencies, but many do. When the information is shared, the credit reporting agency (Experian, TransUnion or Equifax) will attach the name of the company to the identification section of your credit report. It will appear alongside identifiers such as your name, Social Security number and date of birth.

If you applied for credit products while working at previous jobs, those may also be listed. Consequently, your credit report can contain a complete or partial history of your employers.

What won't be included about your employment: the length of time you worked at each company, the positions you've held and your income. All that data is between you and the lender, so will not be shared with the credit reporting agencies.

Employment Information Doesn't Affect Your Credit Scores

The employment history that appears on your credit report is never factored into your credit scores. Credit scores, such as those developed by FICO® and VantageScore, help lenders and other businesses quickly understand how you've been handling your financial obligations. Your employer has nothing to do with the way you've managed credit and debt, so it's not a factor in your scores.

So why would any of your employment history be on your report in the first place? Because it can help a business confirm your identity. To offset the possibility of fraud, a lender may ask you to provide an SSN, mailing address or other reported personal data. A current or previous employer is another bit of information a lender can use to verify that the person applying for a loan or credit product is really who they say they are.

Your Employment Information Is Updated When You Apply for Credit

Don't worry about doing the legwork to ensure your most recent employer is listed on your report. If your new company isn't listed, it won't have an effect on your creditworthiness. The next time you apply for a loan or credit card and provide your job information, the lender will probably send the name of your employer to the credit reporting agency they use to pull your report. If it does, your current employer will automatically update on your report.

Additionally, it's not necessary to update the credit reporting agencies when you get a new job. A credit report is not a resume, so it doesn't need to list all the places you've worked.

What you will want to do is make sure the employment information that does appear is accurate. Errors can cause confusion and delay a credit application from being approved. If you spot an unfamiliar company, dispute it with the credit reporting agency that lists it and it will make the appropriate change.

It's Important to Monitor Your Credit

If you're curious about the employer listed on your credit report, chances are you're already keeping a close eye on your report. If you're in the process of applying for new credit, be sure to obtain a copy of your free credit report from Experian at least a month or two before you submit your application.

In addition to reviewing the factors in your report that do affect your credit scores, take a moment to scan the identification section as well. If anything is wrong and needs to be disputed, take action to have it fixed.

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