When we think about possible consequences of having bad credit, we often stop at the usual stuff like not having access to credit or having to pay ridiculously high interest rates if we do manage to find a company willing to lend us money. But there's one potential drawback that a lot of people either underestimate or simply don't know: having bad credit can stand between you and your dream job.
An estimated 35% of employers use credit background checks as a part of their screening process. And with the current economy, where unemployment is at its highest level in decades, you can be sure that employers are definitely going to be more picky, which means that more and more of them will be using this, if only to sort out equally qualified candidates. Just think of it this way: if 35% of employers check your credit, that means for every three applications of yours that are being reviewed, one of them will be pulling your credit report.
Of course, not everyone needs to be concerned about this, but you still need to pay attention. If your education and/or experience is steering you towards "sensitive positions", such as IT, accounting, finance, high level executive positions, human resources, and so on, then you can be sure that the state of your credit will highly interest your prospective employer. When your position would lead you to have access to information that most other people in the company are not privy to, then poor credit can certainly disqualify you.
If you think that this is far-fetched, consider this: if you are working in a company's human resources department, you have access to social security cards, birth dates, addresses, contacts that make identity theft very easy. Similarly, a person in IT at an e-commerce company has access to credit card numbers for all of their transactions. In those two cases, poor credit can be a sign of future money problems, and you're more likely to succumb to fraud if you're unable to solve your money woes.
For your protection, a company can't pull your credit history as a part of the employment screening process without getting your written consent to do so, and must inform you of your rights. Yet you can take the first step and pull your credit reports (you have the right to a free credit report per year per credit bureau) to see how yours is and correct any mistakes if any. If you adopt a proactive attitude, you can definitely avoid having to kiss a great job goodbye because of bad credit
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