I recently wrote about a House bill that would prohibit private non-financial companies from running credit checks on potential hires. Many people are unaware of the practice until they're interviewing for a job and asked to sign a form permitting the company to check out their credit history.
Some consumer rights groups believe this practice--once used in a more restricted fashion--now extends the cycle of financial difficulty, by preventing credit-challenged workers from gaining the paycheck that could help them find a more solid financial footing.
In the meantime, however, it's something for job seekers to consider in their searches. "The traditional conventional wisdom is: establish your network, get your resume in order. I'd add the third thing, in today's world, is know what your financial information says," says Bruce Cornelius, chief marketing officer of CreditReport.com, a company that monitors consumers' credit reports for a monthly fee.
Free credit reports can be provided once a year, as stipulated by the Fair Credit Reporting Act. The Federal Trade Commission has details on how to go about getting the free report.
Consumers have the right to challenge errors in their reports--a crucial freedom, given that 70 percent of reports contain inaccuracies, Cornelius says.
Try to get a headstart on your credit history so that it's cleaned up as much as possible by the time a company may want to look at it. You can challenge an innacuracy that prevents employment--but only to clean up your report.