Bad Credit Can Cost You . . . Your New Job

Hi Anita,

I just came from a job interview where I was asked to sign a form permitting the company to run a credit check and I’m really worried this will cost me the job. I’ve been out of work for several months and have been living on my limited savings and credit cards (which have all been maxed out). I’ve paid many of my bills late and my credit scores continue to fall. Is there any way to fix the situation and not lose my chance on getting this job?

Dear, Concerned about Credit,

I certainly feel your pain. Getting rejected for employment based on your credit report begins a cycle where nobody wins: you lose a job, which hurts your credit, which prevents you from getting another job, which only pushes your credit further into the dumps.

Yikes!

In an effort to stop this insanity, state governments are starting to step in and restrict or prohibit employers from using credit reports in making hiring and other job decisions. Ten states have passed these laws so far, and more are considering similar legislation.

Key to SuccessThe Federal Fair Credit Reporting Act protects the privacy and accuracy of the information in your credit report, requiring employers to get your written permission to conduct the check. Can you refuse? Yes, you can. But you really don’t have much choice if you want the job.

So why are credit checks run in the first place? Well, it does make sense in some cases. For example, a company may not want an employee who never pays bills on time to manage a department budget, prepare economic forecasts, or have free access to a company credit card. Some employers firmly believe your credit report reflects your ability to be responsible and diligent – two attributes most companies like to see in their employees.

Let’s take a closer look at your dilemma. Late payments and maxing out your cards are definitely red flags. But the fact that prospective employers must get your consent before they pull your report at least gives you the opportunity to explain. Use it.

Now listen up… be proactive and honest. If you are, nine times out of ten, the interviewer will not see a low score as an indication that you’re irresponsible but rather as simply an indicator of your circumstances.

Think about it. Are most employers going to tell you that it was the credit report that caused them to hire someone else? It’s easier to find another excuse or not give one at all.

So tell me, dear readers, have you been turned down for a job and think it was the credit report that broke the deal?

Best wishes,
Anita

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Disclaimer

Anita Clew's blog posts are intended for general guidance and should never be taken as legal advice. In all instances where harassment, inequity, or unfair treatment is believed to be present, please consult your HR Department or legal representation.
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