Is it true that bad credit can hamper your job search?
Are you wondering whether or not you'll get a job with bad credit? Most employees do credit check before interviewing the potential employees. This is why it has become important for the job seekers to have an idea about bad credit and job search. Read along to know more about it.
Bad credit – Can it hamper your job search?
Go through the following lines to gather knowledge on credit and job search:
1. Your credit score is not viewed by employer:
It is true that the employers can view and analyze your credit report. But this does mean that they can also view your credit score. Credit bureaus may send a copy of your credit report to the employers but they will not reveal your credit score to the companies. Credit report offers a snapshot of your credit record to the employers where as credit score reflects your credit risk. This implies that the employers can have a detailed idea about your credit transactions but they will not be able to determine your credit risk accurately.
2. Employers can't view your report without your permission:
According to the Fair Credit Reporting Act, the employers can't glance through your credit report without your written permission. As soon as you give your consent, employers can order a copy of your report from the credit bureaus. They can also check your background from other companies where you may have worked in the past. However, these inquiries will not hurt your credit score.
3. Employers check whether you are financially responsible:
Employers prefer to employ those people who are financially responsible. They want their staff to have good money management skills. Your job prospect will not be hampered if you have missed one payment. This is because employers always look for long-term patterns. They will check whether or not you miss payments habitually. If they find out that you are always late on your payments or a judgment order has been issued against you, then they are less likely to recruit you. Employers just don’t like to get into situations where they have to garnish the paycheck of their staff.
4. Employers may give you a chance to defend yourself:
If you don't allow the employers to check your credit report, then they may reject your job application straightaway. However, if you permit them to go through your credit report, then they may give you a chance to defend yourself. You can explain the circumstances which lead you to incur bad credit. If you can explain your situation convincingly, then the employers may agree to recruit you.
Finally, some states such as Illionois have forbidden the employers to do credit checks of the job seekers. They have taken this decision for the benefit of the job seekers. In the present economic scenario where thousands of people are getting into debt problems or becoming the victims of foreclosure, credit checks are hardly relevant. This is why the state governments of Oregon, Washington, Hawaii, etc. have enacted laws to stop the employers from doing credit checks of the job seekers. However, the employers are allowed to check the credit report of the job seekers in few exceptional circumstances.