What is an Employment Credit Score?
An Employment Credit Score is a pioneering concept from Smart Credit. It is a score for individuals to understand how employers may judge them based upon their credit report.
Because your credit report is being used by 50% of employers to determine hiring, firing or promotion we felt it was important to create a new score that considered factors an employer may use.
Our Employment Score is determined by your credit report. It weighs certain factors more, or less, depending on how an employer may look at your credit report. Remember, employers cannot see your credit score. This means factors on your credit report are manually reviewed and determined differently for a job or promotion than for a loan or line of credit, which is almost exclusive credit score based.
Your Employment Score range is between 350 and 850:
|Great or Excellent||775-850|
|Good or Very Good||685-774|
|Normal or Average||615-684|
|Below Normal or Poor||515-614|
|Bad or Very Bad||350-514|
The Employment Score is calculated from lots of different credit data in your credit report. The percentages below reflect how important each category is to your Employment Score.
|Payment history in the last 12 months – looking for recent financial stress||40%|
|Tax liens and collection accounts||25%|
|Excessive credit cards, automobiles or mortgages – looking for signs of unnecessary or frivolous financial stress||15%|
|New credit or attempts for new credit within the last 6 months – looking for sudden change in financial needs||10%|
|Length of credit history||5%|
|Student loan history||5%|
|Total||100% of your employment score|
As you can see, the last 12 months is very important to an employer. Paying your bills on time, low financial stress and avoiding tax liens or collection accounts demonstrates good healthy behavior on your part. This is important to employers who are looking to judge your character.
Compare that to how standard credit scores are calculated, including the FICO credit score:
|Total amounts owed||30%|
|Length of credit history||15%|
|Type of credit in use||10%|
|Total||100% of your credit score|
Understanding your employment score can be the difference between getting hired, fired or promoted.
Be prepared by keeping your credit report the best it should be. Use SmartCredit.com
Our patent-pending Employment Score is available to all members of Smart Credit at no additional charge. We want our members to see what an employer sees and specifically how they may judge their credit report.
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David B. Coulter – founder and C.E.O. of Smart Credit