Tuesday, December 08, 2015

How to Apply for a Job With Bad Credit


Credit scores are used by employers to screen applicants. Traditionally candidates applying for jobs with the police or fire department, government agencies, finance or banking industries only performed credit checks. Now most companies perform credit checks. 

A candidate can ask that their credit report not be pulled but this will raise an eyebrow and probably disqualify you from being considered for the job because the employer will feel you have something to hide. If you know you have bad credit notify the employer upfront and tell them what you are doing to restore your credit. 

Employers look at bankruptcies, foreclosures, tax liens, multiple bounced checks, divorce, driving violations and medical bills because they assume that a candidate with bad credit or money problems will not be able to perform the job or can easily be bribed.  

Credit checks can judge candidates unfairly because you don't know the reason a candidate hasg bad credit. Some employers feel that if you have bad credit you will not be a trustworthy and dependable employee, i.e. you may arrive to work late, be a lazy employee, borrow money from co-workers, spent money irresponsibly, your attitude, credibility, integrity, etc.

Credit checks can disqualify certain groups of people such as recent college graduates, employees with 1-3 years experience, low-income employees and the elderly because their credit scores may not accurately reflect how they will manage their money in the future.  Here are 5 ways to apply for a job with bad credit.

  1. Applicants should be aware of their credit score and try to get the highest score possible prior to applying for jobs to increase their chances of getting hired, especially if the hiring company states that they will do a background check. It is better to be proactive and let the company know upfront than to wait and have the company find out on their own. By telling the company upfront you appear more trustworthy and honest as opposed to not saying anything which makes you appear deceitful and untrustworthy.
  2. If you have bad credit and cannot get your credit problems fixed in a short amount of time you might have a better chance of getting hired by a smaller company who may not have the same resources and budget as larger companies to perform background checks. Check the law in your state to determine if credit checks are performed as a part of the employment process http://www.ncsl.org/research/financial-services-and-commerce/use-of-credit-info-in-employ-2013-legis.aspx. Here are 4 ways to apply for a job with bad credit.
  3. Order a copy of your credit report from the 3 major credit bureaus - Experian, Equifax and TransUnion at www.annualcreditreport.com or call 877-322-8228. You can also check court records, do your own background check (look in the Yellow Pages under "investigators'") to get an accurate view of your credit history and outstanding debt.
  4. Wait about 3-6 months before applying for a job if you have bad credit to allow enough time to address issues on your credit reports to help increase your credit score.
  5. If you are not hired for a job and feel it was because of your credit you can ask the employer what credit bureau they used and order a free copy of your credit report. A background check can include viewing your credit report, bankruptcy filing, criminal records, court records, drug tests, driving record, and other information. Federal Law prohibits an employer from refusing a candidate basis solely on their credit or because they filed for bankruptcy (FCRA 11 USC §525) but it can be used as a factor in not hiring a candidate. The Fair Credit Reporting Act (FCRA) sets national standards for employment screening but the law only applies to background checks performed by "consumer reporting agency". The law does not apply to employers who conduct background checks in-house.

Always know your credit score, it can mean the difference between being fired or getting the job and salary you desire.

No comments: