How Much Does a Background Check Cost? A Quick Guide

The question “How Much Does a Background Check Cost?” is important for anyone hiring employees, renting out property, or simply wanting peace of mind. The price can vary greatly depending on the depth and scope of the investigation required. 

Factors such as the type of background check needed, industry standards, and the specific information being sought all play crucial roles in determining the overall cost.

This article aims to explore the different types of background checks available, provide insights into the expected costs for each, and offer guidance on how to strike a balance between cost-effectiveness and the need for thorough and reliable information. 

Whether you’re a small business owner, a property manager, or simply taking precautions, gaining clarity on these costs will enable you to make informed decisions without compromising on safety or compliance with applicable laws.

What Is a Background Check?

A background check is a procedure to confirm an individual’s identity and past. It’s frequently utilized by employers, landlords, and various parties to validate whether a person has truthfully disclosed their past actions, qualifications, and legal standing.

The information gathered can include:

• Criminal records
• Employment history
• Education verification
• Credit scores

Organizations conduct background checks on qualified candidates to safeguard themselves against potential risks like fraud, legal liabilities, and other harmful scenarios.

How Does a Background Check Work?

Conducting background checks involves multiple regulated steps, overseen by the Fair Credit Reporting Act to ensure accuracy and fairness. It begins with obtaining the individual’s consent.

How Long Does a Background Check Take? This can vary depending on the comprehensiveness of the check, but typically takes 2-5 business days. 

Once consent is given, the background check provider collects data from public and private databases. This includes:

• Court records
• Credit bureaus
• Previous employers
• Educational institutions, and more.

The gathered information is then compiled into a report detailing the individual’s legal and professional background. This report assists employers, landlords, and other stakeholders in making informed decisions. 

Under the Fair Credit Reporting Act, any adverse action based on these reports must be communicated to the individual, allowing them to review and contest any inaccuracies.

Understanding relevant laws and adhering to legal standards is essential for those conducting background checks. This ensures not only informed decision-making but also compliance with laws designed to protect individual rights.

Types of Background Check Searches

To understand background check costs better, it’s important to know the different types available. Each type serves specific purposes in certain industries and can vary in price depending on how much information you need.

Education/Employment Checks

Education and employment checks are essential in the background check process. They confirm a candidate’s education and work history. Employers use them to verify applicant information and assess their suitability for the job. 

These checks reveal details like degrees earned and previous employers, ensuring the job candidate’s credentials are legitimate.

Identification Checks

Identification checks are crucial for verifying a person’s identity. This involves thorough checks on documents such as social security numbers and driver’s licenses. 

These verifications are essential for preventing identity theft and confirming the legal eligibility of job applicants and candidates. Checking social security numbers is a fundamental aspect of the hiring process, facilitating overall legal compliance.

Public Record Checks

Public record checks involve reviewing records that are available to the public; such as criminal records, bankruptcy filings, and civil litigation records. 

This search helps to uncover any national criminal records that could influence an employer’s hiring decision or in the hiring process. It’s essential for maintaining safety and integrity within the workplace.

Online Record Checks

These involve searching through various online databases to gather information about a person’s online activities and footprint. While not as formal as other checks, they can provide additional insights into a person’s character and behavior.

How Much Does a Background Check Cost?

The cost of a background check can vary based on the type and depth of information required. Let’s break down the costs associated with different background check services.

Are There Free Background Check Search Tools?

Free tools do exist that can provide basic information, such as checking for criminal records or verifying contact details. However, these tools are often limited in scope and may not always be reliable.

How Much Do Background Checks From Background Check Companies Cost?

Professional background check companies typically offer packages that range from basic to extensive criminal database and credit checks. 

Depending on the depth of the background check, the basic for a criminal background check is $25 and can go up to $100 or more for a detailed background report that includes employment, education, and credit history. 

These companies ensure that the checks are conducted in compliance with the Fair Credit Reporting Act, making them a reliable choice for employers.

How Much Do Online Background Checks Cost?

Online background checks can vary in price depending on the service provider and the specifics of the search. Generally, these services charge a fee that can range from $20 to $50 for a single report.

More comprehensive searches that include multiple record types can cost more. Online checks are useful for quick searches but may not always meet the standards required for certain legal or employment decisions.

Factors Influencing Background Check Costs

The cost of background checks isn’t static; it varies based on several factors that you’ll need to consider. Understanding these can help you manage costs effectively while ensuring that you get the necessary information for safe and informed hiring decisions.

Type of Background Check

The complexity of the background check directly influences its cost. A simple criminal background check is generally less expensive than a more detailed employment background check that verifies education, past employment, and professional licenses.

Scope and Depth of the Check

A more thorough check that covers national criminal records, credit history, and driving records will cost more due to the additional resources required. The broader and deeper the scope of the background check, the higher the expense.

Third-Party Provider vs. In-House Background Checks

Using a third-party provider can sometimes be more cost-effective, especially for companies that do not have the internal resources to conduct thorough checks. However, managing some aspects of the process in-house might reduce costs for companies that can do so.

How to Reduce Background Check Costs

Choose the Right Type of Background Check

Understanding the specific needs of the organization for your position can help you select the appropriate type of background check and avoid paying for unnecessary information.

Partner With Reputable Background Check Providers

Establish a relationship with a reliable background check provider. Reputable companies often offer competitive pricing and better accuracy, which can save costs associated with handling disputes or rechecking information.

Consider Bundle Packages

If you regularly need background checks, look into bundle packages that providers may offer. Buying checks in bulk can significantly reduce the per-check cost, providing savings over time.

Implement Efficient Hiring Processes to Reduce Turnaround Time

Plan your hiring process carefully to avoid needing background checks in a rush. This lets you use standard processing times, which are cheaper than faster screening options now.

What’s the Most Cost-Effective Way for a Large Company to Run a Background Check?

For large companies, managing the cost of background checks while maintaining thoroughness and compliance is a significant challenge. The most cost-effective strategy is to leverage economies of scale and establish long-term partnerships with reputable background check providers. 

Large companies can benefit from several strategies for efficient background checks:

• Customized Packages: Negotiate with background check providers to create bundles that combine different checks (criminal history, employment, education) based on the specific job role
• Streamlined Systems: Integrate background checks into your HR system. This saves time and reduces errors by automating some of the processes
• Tiered Screening: Use a more thorough background check for higher-risk positions with greater responsibility. This ensures you get the necessary information while using resources wisely

What’s the Most Cost-Effective Way for Small Businesses to Run a Background Check?

Small businesses, with their typically tighter budgets, need to be strategic about how they conduct background checks to ensure they do not overspend. The most cost-effective approach is to focus on the essentials.

For most jobs, a simple criminal background check and verifying claims on the applicant’s resume, like work history or education, are usually enough. Small businesses should find background check services that don’t require a minimum number of checks and let them pick only what they need for each job. 

This stops them from spending too much on checks that aren’t needed for certain roles. Also, small businesses can use online background check services, which usually have good prices, and let them do checks as they need them without signing up for a long time.

FAQs about the Cost of Background Check

Why Do Background Checks Cost Money?

Background checks cost money because they require access to various databases and resources, some of which charge fees to use their services. 

Additionally, the process of compiling and verifying the information is labor-intensive, often requiring skilled professionals to ensure accuracy and compliance with legal standards.

How Much Do Companies Spend on Background Checks?

Companies can spend significantly on background checks depending on their volume and the complexity of the checks required. On average, small to medium businesses might spend anywhere from $20 to $100 per check. 

In contrast, large corporations, due to volume discounts and bundled services, might spend less per check but incur higher overall costs due to the number of checks conducted.

Where Is the Best Place to Get a Background Check?

The best place to get a background check will depend on your specific needs. Reputable third-party providers such as TruthFinder and Intelius who specialize in comprehensive and legally compliant background checks are generally the safest choice. 

Websites offering quick, low-cost checks can be useful for less critical investigations but might not provide the thoroughness required for employment screening or legal compliance.

Why Do Companies Run Background Checks?

Companies run background checks to mitigate risk and ensure workplace safety. These checks help verify the accuracy of an applicant’s claims on their resumes, assess their potential risk to the company, and ensure they meet industry-specific regulatory compliance, especially for positions that require high trust or handle sensitive information.

Can Anyone Run a Background Check?

Yes, generally anyone can run a background check, including on yourself, as long as you adhere to legal guidelines, such as obtaining the subject’s consent when required by law. 

The Fair Credit Reporting Act (FCRA) and other laws regulate who can run a background check and how the information can be used. 

If you’re wondering how to do a background check on yourself, you can start by accessing public records, obtaining a copy of your credit report, and using reputable online services that provide background check information. 

This can help you see what potential employers or others might find and ensure that your information is accurate and up-to-date.

What Do Background Checks Show?

Background checks can show a variety of information including criminal records, employment history, education verification, credit history, and more. The specifics will depend on the type of check conducted. Criminal background checks, for example, will detail any criminal activity associated with the candidate or individual.

Final Note On How Much Do Background Checks Cost

The cost of background check services can vary based on numerous factors such as the type of check, the extent of information required, and the service provider.

On average, a basic check might cost between $10 to $40, while more detailed investigations, such as employment background checks or checks that include criminal background checks, can cost upwards of $100.

The investment in a background check should align with the importance of accurate, reliable information for decision-making purposes, ensuring safety and compliance in professional and personal contexts.