September 9, 2010

Could Your Credit Prevent You from being Hired?

In this economy, every open position is extremely competitive. Did you know that a poor credit score could actually be the deciding factor between you and another candidate?

It isn’t illegal to check credit scores as part of the hiring process. Employers do have to stick to Fair Credit Reporting Act (FCRA) rules, though. The two main rules are 1) that you have give permission for an employer to look at your credit score and 2) if you’re turned down for a job because of your credit score, the employer has to show you the report. This theoretically allows you to address any problems, like mistakes on your credit report.

Why could bad credit prevent you from getting a job?

  • If the job requires you to handle money, which is likely if you’re interested in jobs in retail or jobs at a casino for example, the employer might be worried that you’re in such need of money that you’ll steal from them.
  • Paying bills late could mean that you’re not responsible with your money and therefore will not be responsible with your job tasks.
  • People with bad credit are typically more stressed, and worrying about money could affect your work.
  • If you have to go to court due to monetary problems, you could potentially miss a lot of work.
  • The employer might worry that you’re only applying to the job because you need money, not because you’re passionate about the work, want to work for the company, or are even qualified. You might be lying about things just to get a job.
  • If the job is entry-level or doesn’t pay well, the employer could be worried that you’ll bolt as soon as something better-paying comes along, which means they have to go through the hiring and training processes all over again.

Bad credit doesn’t necessarily mean that any of the above points are true about you. Sometimes, life just prevents you from paying bills on time or otherwise maintaining good credit. All of these things could be true, though, and if you and another candidate are equally qualified on every other level, the employer might be afraid to take a chance on you.

So what can  you do? Take steps to clean up your credit! This is a long, hard road, but ignoring the problem won’t make it go away. Contact a credit counselor today to get started managing your finances and improving your credit score so it is never an issue for employers.

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