Guest Author - Dianne Walker
It can be a vicious cycle, you have been unemployed for a while and the bills are piling up. You cannot pay on time so your credit goes downhill. You need a job to pay the bills, but you cannot get a job because your once stellar credit is suddenly too low to finance a pack of gum. Can low credit affect your job search? Absolutely. Also if you’re up for a promotion and you think you’re safe because you already work for the company, think again. Bad credit can have long term, long reaching effects.
Not all companies check credit, however, many do as part of a background check. While the majority of employers check because of cash handling or accounting tasks, other employers check as a means of determining your reliability. You should never assume that the type of job will preclude the employer from performing credit checks.
Check your credit report prior to searching for a job. It may be too late to fix errors or change your past, but at least you will have a heads up on the information a potential employer may see. If there are errors on your report, start the process to get them resolved. While employers can still use this information against you in hiring, at least you will be able to develop answers to questions which are certain to be asked.
If you have signed a release form, they have a legal right to run your credit. Ultimately, employers must practice due diligence when it comes to protecting the company, its employees and its assets.
How to respond during the interview
Trying to explain a bad credit report is highly personal and can be very difficult. Savvy employers, however, realize there are many factors which can temporarily affect credit scores such as divorce, recent purchases and recent requests for credit. You may be wondering what right these strangers have in checking your personal business. Unfortunately if you want the job you will need to respond. Keep your answers short. If your report is due to unemployment, admit it. Acknowledge that it is a first time (hopefully), limited time (once you start working again) occurrence and once you are gainfully employed, you will take measures to improve your credit score. By way of example, prove that your credit score has nothing to do with your work performance. Talk about your many successes on the job.
If your credit report is used as the basis for not offering you the job, you must be notified. It is, however, a legitimate concern for employers.