Credit Education

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03. Aug, 2016

Not Getting The Job of Your Dreams Due To Bad Credit – “How Did this Happen?”

The job seeker has all the skills, and the interview goes great. Only a few routine background checks stand in the way of the dream job. Unfortunately, the prospective employer asks to see a credit report. The law gives the right to say no, but this is unlikely to do much for those in a job interview circumstance. So the candidate agrees, and the employer sees their credit report. Unfortunately, the job seeker’s impressive qualifications and recommendations now fail to cancel the impression a poor credit report makes.

Employers reject a fair number of job applicants because of poor credit reports. In 2013, the CNN network estimated this happens to one out of ten job applicants. For many jobs, employers do not ask to see credit reports. However, employers often want to see credit reports for applicants of higher, responsible positions.

What Credit Reports Reveal
Credit reports cover personal finances over an extended period of time. Credit bureaus compile these reports from the information banks and other lenders provide. Responsible financial behaviors earn a high credit rating, while events like missed and delayed loan payments push ratings down. Bureaus have their own policies to define the boundary between good and bad credit ratings. While lenders get to see a borrower’s credit score, the law prevents bureaus from sending employers credit scores. The person in charge of hiring must draw conclusions from the general impression the credit report makes.

What Employers Look for in Credit Reports
If a job applicant has the relevant skills and experience, why should credit status ruin their chances? Is it so unusual to get into debt at some point?

Employers want to make sure workers are completely trustworthy. Dishonest or irresponsible employees cause financial loss and damage business reputation. An unfavorable credit report raises suspicions that this person lacks integrity or does not have the competence to manage their personal finances.

Everyone knows people get into credit difficulties for a variety of reasons.  Reckless behavior leads to financial problems, but job loss or sickness also brings debt. All the same, prospective employers usually prefer to err on the side of caution. A poor credit report puts the job seeker at a disadvantage regardless of the reasons for their poor financial showing.

Credit Reports and Job Applicant Rights
To avoid credit information abuse, some US states forbid employers from requesting credit reports. The Fair Credit Reporting Act also restricts the information that credit bureaus can provide. Employers receive modified versions of the information lenders get. The most glaring difference is the absence of credit score details.

If the employer decides not to hire someone because of their credit report, the law obliges them to supply a copy of the credit report to the rejected applicant. Sometimes they may notice a mistake, and persuade the employer to review their decision. People should definitely challenge credit reports if a payment made on time appears late  or other errors turn up. Credit bureau workers make mistakes  occasionally.

Whenever possible, remain paying debts promptly and keep the ratio of debt to available credit below 30%. This policy boosts the job seeker’s attractiveness. It also brings many other benefits, like easier and cheaper access to loans for houses, cars, and major purchases.

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