Bankruptcies can have a significant impact on an individual’s financial standing and can stay on their credit report for up to 10 years.
It’s no wonder that many people are concerned about whether or not a bankruptcy will show up on a background check.
In this article, we will explore the answer to this question and the implications of a bankruptcy on background checks.
First, let’s define what a background check is. A background check is a process used by employers, landlords, and other organizations to verify an individual’s background information.
This information can include a person’s criminal history, employment history, credit history, and educational background.
When it comes to bankruptcies, they will typically show up on a background check if the check includes a credit report.
Most background checks include a credit report because it gives organizations insight into an individual’s financial stability and responsibility.
Bankruptcies can have a negative impact on a person’s credit score and stay on their credit report for up to 10 years, so it’s likely that it will show up on a background check.
It’s important to note that not all background checks are the same.
Some background checks are more extensive than others and can include different types of information.
For example, some background checks may only include criminal history, while others may include credit reports, employment history, and education.
It’s important to understand the scope of the background check you’re undergoing so you know what information will be included.
If a bankruptcy does show up on a background check, it doesn’t necessarily mean that an individual will be automatically disqualified from employment, rental housing, or other opportunities.
However, the bankruptcy may be taken into consideration when making a decision.
For example, an employer may view a bankruptcy as a sign of financial instability or irresponsibility, and this could impact their decision to hire an individual.
Similarly, a landlord may view a bankruptcy as a risk and decide not to rent to an individual.
It’s also important to know that bankruptcies can be filed for different reasons, and the type of bankruptcy can have an impact on a background check.
For example, a Chapter 7 bankruptcy involves the liquidation of assets to pay off debts, while a Chapter 13 bankruptcy involves a repayment plan.
An employer or landlord may view a Chapter 13 bankruptcy as a positive sign of financial responsibility because the individual is actively working to repay their debts.
In conclusion, bankruptcies will typically show up on a background check if the check includes a credit report.
It’s important to understand the scope of the background check you’re undergoing and to be aware that a bankruptcy may be taken into consideration when making a decision about employment, rental housing, or other opportunities.
However, a bankruptcy doesn’t necessarily mean that an individual will be automatically disqualified, and the type of bankruptcy can also have an impact.