Not many employers hire people without first combing through their credit report these days. That’s because the report gives them a read on how responsible the would-be employee might be.
When someone hires you they make a big financial investment; so they’ll often try to reduce their risk by reviewing your credit history before making an offer.
If you’re hunting for a job, but have a few smudges on your credit history, here’s what you need to do:
Get a Copy Of Your Credit Report
Any serious employer will investigate your credit report from top to bottom before getting down to brass tacks with you, so it’s in your interest to become familiar with what’s in the report and understand what it says about you before it goes viral.
Fortunately, it’s free and easy to get your credit report by contacting AnnualCreditReport.com.
Fix What You Can
Even if you struggled with credit and debt in the past, it doesn’t mean that all the negatives on your credit report are accurate. In fact, according to the most recent Federal Trade Commission report, 20% of all credit reports contain mistakes and flaws. That means your report could very well contain dings that really shouldn’t be there.
Don’t allow false negative information to hurt your chances of getting a job. Contact both the credit bureaus and the creditors who reported these mistakes and demand that they clean up their sloppy work. By law, they have to either fix mistakes or tell you why they won’t — and provide the proof either way.
Dispute What You Reasonably Can
For a negative item to remain on your credit report, it has to be accurate, verifiable and complete. If it lacks any of these attributes, you can tell the credit bureau to remove it.
The wonderful thing about disputing an item is that your claim becomes part of the credit file even if negative mark stays on your record. So if you have a reasonable explanation for any hiccups, your future employer will see those explanations in your report.
Work Your Network Openly
It’s highly likely that someone you know is going to introduce you to someone else who can get you a job interview, which is why it’s best to be straight with your friends, acquaintances and work colleagues about any negatives in your financial past. This way you can explain what happened and how you corrected it. And by being upfront, you avoid putting your contacts in an embarrassing situation.
Confiding in people you need to help you is a must if you want to generate good karma — and not burn any bridges.
Discuss Your Credit Report During Interviews
A poor credit report doesn’t have to be a negative unless you ignore it and allow the employer to read all about it without hearing your explanation. In fact, it might actually turn out to be a huge positive as long as you turn it around and don’t try to hide anything — so get in front of the bad news by talking about it. Explain what happened, why, and what you’ve done to turn things around. Don’t try to pass the buck or avoid taking responsibility.
Employers don’t mind if people make mistakes as long as they learn from them. What they don’t want is someone on the team who blows it and won’t own up.
While some potential employers will look at your credit report and dismiss you out of hand if you’ve had some bumps along the way, the smart bosses will pay attention. They’ll like that you are upfront about your challenges and they’ll love that you take responsibility and have taken a problem and turned it into a strength. That is the kind of employees smart employers want to hire.
Do you have a checkered credit history? Has it held you back when it comes to employment? How? What have you done about it?
About the Author: Neal Frankle is a Certified Financial Planner based in Los Angeles. He is also the chief editor for WealthPilgrim.com, MCMHA.org and CreditPilgrim.com
Photo Credit: bark