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Credit and Employment Tips

It is not uncommon for people to find ways around building up debt. Buses and walking easily replace having a car, homes can be rented, and even health insurance can be put on the back burner, although that isn't advisable, it can still be done. Everyday dozens of people find ways to utilize cash instead of plastic. There is one thing that a person cannot function without and that is a job.

It is important to know that the law prohibits an employer from denying employment to someone based on bankruptcy findings. However, the law does not prohibit an employer from denying an application, or even rescinding an offer, based on other credit issues. Some of these issues could be inquiries, foreclosures, or collection actions. More and more companies are using credit reports as a means of hiring, firing, and for promotional purposes. One survey that was taken by the Society for Human Resource Management showed that 35% of companies are now performing this practice.

The most common practice for employers still remains to be the background check, but studies have found that if a company is pooling resources in order to verify background, more often than not, they will go ahead and pull the credit report also. However, many employers have found that finding credit mishaps did not determine whether or not an employee was more likely to steal. The better predictor, most would say, is a full criminal background check, which would show things such as bounced checks. Employers will also use credit checks in order to make sure employment history is correct and that the Social Security numbers are valid. This is a measurement that is taken as a form of insurance for a company that is trying to hire new staff members.

If you are trying to get a job with the government, you will have your credit checked. However, there is no need to worry if your credit is not in the best shape. The government will only use the credit report as a means of denial if the prospective employee would have direct access to cash or if there were security clearances concerned.

There are rules that people have to follow, regardless of the position that is being applied for. For instance, an employer has to have your permission before they can run a credit check. The permission has to be obtained in writing, and any deviation from this method is against the law. Bankruptcy is not supposed to be considered a problem. Remember, they can take issue with you not paying your bills, but not if you have filed for bankruptcy. Finally, if your credit information is used against you in any way, the employer is required to tell you what the problem is.

The bottom line is that you need to stay on top of your credit in the best way that you can. Credit is starting to effect people more and more as the years go by. Twenty years ago, you would have not thought that a bad credit report could make you unemployed, but here we are today and the numbers of people who are losing their jobs due to bad credit are increasing. Protect yourself by taking the right measures to being responsible.