What is a consumer credit report?

June 24 2021
3 min read

A Consumer Credit Report is an "Employment" credit report that provides information about a candidate's financial history. It may reveal indicators of finical irresponsibility that could affect your organization. Are their finances in order?

If the position you are hiring for will have access to sensitive financial information, funds, or assets, it is important to get an accurate picture of their financial history. Performing a credit check can be a deterrent against threats such as money laundering, embezzlement, and accounting fraud.

What does a consumer credit report show?

A Consumer Credit Report is an "Employment" credit report from one of the major credit bureaus. Consumer credit reports provide information about a candidate's financial history. 

Credit reports often contain the following information:

Personal Information

  • The current name and other names associated with the consumer (candidate)
  • Current and former address

Credit Accounts

  • Current/past trade accounts
  • Current/past lines of credit
  • Account payment history
  • Credit balances

Public records

  • Bankruptcy
  • Accounts in collection
  • Civil judgements
  • Tax liens

 In addition the report may include information regarding other inquiries into the consumer’s credit and some information about the consumer’s employment history.

As required by the Fair Credit Reporting Act, an "Employment" credit report does not include a credit score.

Federal Consumer Credit Check Laws

The Fair Credit Reporting Act (FCRA) is a federal law designed to regulate the use of consumer report information and other background information received about individuals from consumer reporting agencies (CRA) like Orange Tree.

The FCRA mandates that companies disclose, authorize and get consent as part of the law. If you decide not to hire someone based on what you found in the credit report, you must follow an adverse action process. 

Read our blog to learn more about what employers need to know FCRA compliance. 

State and Local Consumer Credit Check Laws

Certain cities and states have other requirements, mainly surrounding how the credit reports are used in the hiring process. Typically, the laws will only allow for credit checks if the employee has job requirements like handling money or has access to company trade secrets. Managers often have credit checks performed as part of their background screening. And specific jobs in financial services also require a credit check. 

Can you deny someone a job because of bad credit?

In 39 states and Washington, D.C., employers can use the information in the credit checks when making hiring decisions. 

11 states do not allow you to use the information, but each one has exceptions. The exceptions include hiring for financial institutions like banks or checking the credit report very late in the hiring process. 

How long do consumer credit checks take?

After the candidate provides consent, the results of a credit check are typically available the same day. If you perform a credit check as part of a comprehensive background screening package, the final report may take anywhere from 1-5 days.

Get started with consumer credit checks from Orange Tree

A credit report can be an essential part of the background check process. Rather than wait, use a professional screening servicing like Orange Tree so you can get it done quickly and professionally. 

We submit your credit report request to one of the major credit bureaus and can generate a report as fast as possible. You'll know if your applicant has any financial red flags in their history quickly, which will help you make a better hiring decision. And when you work with us, you won't have to worry about being out of compliance with any federal, state, or local laws.

For more information on running credit checks or any other background screening services, schedule a call today. 


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