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Poor Credit Ruining my Job Prospects

by Jeanette

Recently I've been denied interviews with hiring managers due to my credit report. My house was foreclosed on 3 years ago. During the initial sale, they split my mortgage. One shows foreclosed on, the other shows charge off. To potential employers it looks like I opened a line of credit and let it go down with my house. Right after that, I moved in with a friend. She sued me for crazy things. Out of $4000 she initially sued me for, the judge awarded her a $1000 plus court costs and fees. She just came around to suing me... 2 years later. So I have a judgment made against me, and a $70,000 charge off account. What do I do when they ask me for permission to run my credit? And is there anything I can do or say to get around this obstacle?

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Mike Petras responds:

Sorry to hear of your credit woes that are interfering with your job search. I hope I can share with you a few ideas to help you move forward.

The good news is that although 60% of companies claim to check your credit as part of their hiring process, only 13% actually check it, according to a May 2010 USA Today article (link to article no longer available). According to this article, 16 states have introduced legislation to ban the practice, and 2 states have already done so...Hawaii and Washington.

Here is an update about this trend published in the Chicago Tribune, September 11, 2011, Poor Credit Endangering Job Prospects.

In my experience as an executive recruiter, most companies won't check your credit until after your job interview. This gives you a chance to impress hiring authorities and win them over before they prejudge you on a credit number.

There is an old saying, "You can form a mind, but you can't change a mind". In other words, if you do well in your interview and form a positive impression in the minds of the hiring managers, your weak credit score may be overlooked...or possibly not even checked. So, it's very important that you interview well.

Even so, you should do everything you can to improve your credit history. There is an excellent article on MSN Money, How bad credit can cost you a job, that contains several links to other articles and advice on how to boost your credit score and overcome credit problems.

The judgment against you is more problematic and could be viewed more negatively by employers. Your best bet would be to hire an attorney, but if you're unemployed or on a tight budget, you may not be able to afford it.

Here are a couple of good resources for you to investigate:

Lastly...don't despair. Keep applying for jobs and moving forward. Many companies won't check your credit, and others might give you an opportunity to explain your situation. You must be prepared by having a short (30 seconds) explanation that makes sense and is believable. If you hem and haw and ramble on and on for 2-3 minutes, most companies will reject you.

Also, if you were wrong and deserved the judgment, you'd be better off admitting it and letting the chips fall where they may. Tell them what you learned from it and share your commitment to not repeat it. Most people want to forgive others, but if they sense you can't be trusted, it's just easier for them not to hire you.

All the best with your search. Hope you can resolve this quickly.

Mike Petras

P.S. If you, or someone you care about, has been unemployed for 6 months...or new book could provide you the breakthrough you've been praying for.

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Dec 14, 2010
Thank you
by: Jeanette

Thank you for all your insight and advice. I am just very confused on how or why a frivolous law suit is connected to my credit report.

I have not done any criminal activity nor was jail time ever an option. Since I wrote this, I have received in the mail the actual reasons why I am being denied, and it is more this judgment. I have paper work to explain my foreclosed accounts and they were accepted, but the judgment they do not overlook.

For whatever reason, the companies that are calling me, need me to pass a credit check before I go before a hiring manager. FRUSTRATION and crying seems to be my only two emotions lately.

Mike Petras comments:

Did you know you can write a brief explanation about your judgment on your credit report?

It might help.

By law, each of the 3 credit bureaus must provide you with a detailed copy of your credit report, if you request it. I've created a link to each of their sites for you, Experian; TransUnion; and Equifax.

It's kind of a project to read through each credit report to figure out their symbols and abbreviations, but you really need to do it. They can be 20-30 pages long.

Even so, just start with one report and slowly read through it making notes and highlighting stuff. You're going to find errors and entries that can be deleted or corrected. But, you can also write an explanation for your judgment that will give creditors and other interested parties your side of the story.

I know it's tough for you right now, but hang in there. Remember, most companies are not going to check your credit. Also, this will eventually blow over and not affect you one day.

Good luck!

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