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Employment Credit Checks – Why Leave Anything to Chance?BlogPersonal Finance


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"Businesswoman suffering from a headache", via Ingram Publishing, ThinkStock.

“Businesswoman suffering from a headache”, via Ingram Publishing, ThinkStock.

No doubt about it, in today’s turbulent financial times it is a buyer’s market when it comes to getting a job.

Employers have access to a virtual cornucopia of qualified talent, all competing for a limited number of jobs, and a unique understanding of how cyberspace and credit reports can be effectively utilized to better vet applicants.

According to the Washington-based Society of Human Resources Management (SHRM), 47% of U.S. companies conduct credit checks on “pre-employment” job candidates.

Employers defend credit checks, saying they contain a wealth of information about candidates and can help root out folks who are disorganized and financially irresponsible, as well as potential embezzlers and thieves. Employees in the financial sector already know the drill: banks and investment companies routinely conduct credit checks on employees who may either actively handle money, or have close proximity to sensitive financial records. Now other industries are following suit.

Since you can’t escape your financial reputational fingerprint, here are some tips to better your odds of nailing your dream job if your credit report comes into play:

  • Get out in front of any negative credit issues. Assume that an employer will run a credit check on you. If that means they’ll find negative information or delinquent accounts in your credit report, have a good explanation ready. The SHRM study shows that 65% of employers allow job candidates to explain negative information in their credit report. If you’ve suffered some health problems, lost a job, or survived a brutal divorce, let the employer know.
  • Negotiate a “trial” period. Lots of people get behind on their debts and employers understand that. If that’s the case, suggest a “trial” period where you’ll pay any outstanding balances and bring your accounts current after a fixed amount of time of employment (say, six months). The fact that a company is running a credit check on you means they’re interested. So use your negotiating skills to justify and reward that interest.
  • Check your credit report for accuracy. Here’s a shocker – credit reports can contain inaccurate and incomplete information. Mistakes happen. Make sure you know what’s in your credit report before your potential employer does. According to a White House report, six million Americans “have errors on their reports serious enough to result in a denial of credit.”

Thanks to federal law, you’re entitled to a free copy of your credit report, once a year, with no strings attached, from all three of the major credit reporting agencies. To claim your free report(s), simply visit the federally mandated website at AnnualCreditReport.com.

I encourage anyone looking for a job to take full advantage of this federally mandated right. The competition is fierce, why not anticipate the objection and have as many arrows in your quiver as possible?

Originally posted at Credit.com.