Minimize The Impact

If you have bad credit and are looking for a job, consider these ways to minimize the impact it could have on your employment prospects:

1. Know your rights.

Employers must tell you if credit histories will be used to evaluate job candidates and get written permission to pull your reports. While you have every right to reject that request, the company can use that refusal to reject your application.

And by the way, section 525(b) of the U.S. Bankruptcy Code prohibits employers from refusing to hire someone because he or she is bankrupt.

2. Know your history.

You’re entitled to one free credit report per year from each of the major credit-reporting agencies. So before you start the job search, visit and request your Experian, Equifax and TransUnion files. Read them thoroughly and correct any errors before those credit histories get in the hands of a potential employer.

Errors do occur. According to a study by the Federal Trade Commission, 1 in 5 American consumers found an error that negatively impacted their credit history on a credit report from one of three major credit-reporting companies.

3. Get it in writing.

If an employer is disinclined to hire you because of something in your credit history, he or she must provide a copy of the report and a “Summary of Rights” that explains how to contact the company that provided the report.

You are also entitled to a notice that explains your right to dispute the “accuracy or completeness of any information in your report.”

4. Go on the offensive.

If you’ve encountered recent financial difficulties, consider letting an employer know this before the firm pulls your credit report.

For instance, if you’ve been a victim of identity theft or your spouse recently lost a job, be up front about this and explain how you’re working to repair any damage that was done. Employers will most likely admire your honesty and forthrightness.

5. Focus on your qualifications for the job.

In all likelihood, even a credit history laden with foreclosures and tax liens won’t be your professional undoing.

Once you’ve discussed it, forget about it. Focus on accentuating the many qualities that make you a perfect fit for the job. Invariably that’s what counts the most.

6. Do the right thing.

Now is the time to take corrective action (whether you’re looking for a job or not). Catch up with any old bills, and make sure you have a system to promptly pay new ones as they arrive.

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