More and more employers are doing credit checks as part of the hiring process. What used to be only banks or companies that have access to vital personal information of clients has now become almost all employers doing credit checks and background checks. For some employers, bad credit can be a deal breaker. For other’s it’s a formality and one that can be discussed and explained. So what do you do if your credit is bad?
First, know your credit history and the facts about what your report says. You can’t know how to respond to something until you have the facts. Be sure to work with the credit reporting agencies to correct anything that’s false on the report. This can be a taxing process but it will be worth it in the end.
Second, don’t panic or avoid applying for a position because you assume your credit report will cause a problem. Every company is different and has different policies on the subject. Don’t use poor credit as an excuse for trying.
Third, once you’ve had a good interview and you realize the process may be moving to the background/credit check phase be honest with the interviewer. Take it from me, there’s no worse feeling than learning about a potential deal breaker when you really like the candidate. The interview may feel lied to if (s)he has to find it out from a report. Being honest gives you the opportunity to explain what has happened. DO NOT go into too much personal detail but it’s ok to share with the employer if you had good credit before loosing your job but late payments have occurred since your recent job loss. When they pull the report, it will reflect the timeline you’ve shared and may be something to make them reconsider. The same can be true for bankruptcies. Most companies look at medical bankruptcies differently than other types of bankruptcies. Others may reconsider if the bankruptcy was several years ago. If it was recent, be honest about that too. Your best bet is to be brief, calm, and factually. Do not under any circumstances share your personal drama with a potential employer.