People can live without owning a home, they just rent. People can live without owning a car by riding the bus. People can go without health insurance; it is not ideal but possible. People learn how to deal with cash only instead of credit cards, but there is one thing that it is hard to function without – a job. Now it is having an effect on people’s employment in a way that it didn’t in the past.
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.
Should you apply for a job with a governmental agency you will most likely have to go through a credit check. This might sound intimidating; however a governmental credit check isn’t as scary as having one done for a private company. Aside from the usual need for security clearance, the government will run a check if the job you are applying for will have you dealing with cash.
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.
When it comes right down to it, the best thing you can do for yourself is to stay on top of your credit. Credit affects people more and more with each passing year. During the time of our grandparents no one would have ever thought that they would be refused a job due to bad credit. Today, there are many people who lose their jobs due to bad credit and it is affecting us all in ways we never would have thought of.
By: Mike Selvon
If you have ever gone shopping for a new car or made an attempt to purchase a new home then you are probably familiar with your credit score. Even if you haven’t made any type of purchase that required you to obtain a loan or credit due to the amount of money involved you’ve probably still seen or heard the words credit score mentioned on the television or in a business or financial article. The reason for this is because our financial well being in today’s complicated credit/loan society revolves around that very powerful three digit number known as our credit score.
There are many ways to explain what exactly our credit score is, but frankly trying to sort out the scientific and mental calculations involved only serves to give me one big giant financial headache. The main point to remember here is that the credit score determines an individual consumer’s credit worthiness as seen in the eyes of the three main credit score companies or bureaus as they are sometimes called. The score is based on a combination of a consumer’s current credit situation and their previous credit history with many additional mitigating factors.
The three main credit bureaus are Trans Union, Equifax and Experian. Each company has developed (with the Fair Isaacs Company) their own unique method to determine your FICO (credit) score. Don’t be alarmed by this because although each credit bureau has their own method for determining your credit score the numbers remain standardized across all three companies. For instance a 700 with Trans Union is equal to a 700 with Equifax and Experian.
So what exactly constitutes a good credit score? In order to determine that we first need to know the scoring parameters that makes up the scoring scale. As previously mentioned your credit score is influenced by a variety of factors such as outstanding debt, your credit history, the types of credit you current have or use and your payment history. These factors when analyzed form a score that can run anywhere from a low of 375 to a high of 830 or 900 depending on which expert you ask. These numbers generally serve as a guideline that a credit lender can then use to incorporate into their own credit rules that are tailored to their company’s in-house credit program. However generally speaking a credit score higher then 650 has the potential to be considered good credit in most cases. The national average for the FICO credit score varies. I’ve seen it as high as 723 and as low as 676. With that said a consumer with a credit score higher then 700 is considered excellent, a credit score between 601 – 699 is decent and anything less then 600 could probably use a financial makeover in order to raise the credit score.
Keep in mind that these categories could fluctuate depending on the national average and also remember these numbers just represent a guideline for lenders to use when determining your credit worthiness based on the FICO credit score. It’s their in-house line of credit rules and regulations that will ultimately decide if you have a high enough credit score to obtain financing at the most favorable terms offered by their company. Once thing is for sure the higher the credit score number the easier it is to receive credit and the more favorable the repayment terms are as far as interest rates go.
By: Tim Gorman
Having less than perfect credit does not cancel out your credit card options. In fact, just the opposite is true. These days, credit card lenders issue plastic for every need under the sun. This includes cards designed specifically for those with poor credit. By taking advantage of bad credit credit card offers, you can get back on your financial feet in no time. Read on to learn more about bad credit credit card offers.
Prepaid Debit Cards
If you have trouble getting approved for a traditional credit card, a prepaid debit card is a smart alternative. With this option, you first deposit money into your account. You can then use your card to make purchases. To help you stay on track, your line of credit is limited to the amount you have deposited. By putting money into your account and making purchases, you will rebuild your credit. For two great prepaid options, check out the All-Access Visa Prepaid Card and the Wired Plastic Prepaid Visa Card.
Secured Credit Cards
Another option for those with bad credit is a secured credit card. This type of card requires you to open a savings account. The account serves as security for the line of credit. The credit available to you is a percentage of your deposit. This usually ranges from 50 to 100 percent. If you pay off your balance consistently, over time your line of credit will increase. A secured credit card usually includes an annual fee and high interest rate.
First Premier and Orchard
Perhaps you plan to occasionally carry a balance on your card. If this is the case, there are various bad credit credit card offers available. First Premier Bank issues cards designed for those with poor credit. First Premier Bank credit cards offer low interest rates and the chance to improve your credit rating. You can be approved instantly for one of their cards. Check out the First Premier Bank Gold MasterCard/Visa to get you started.
Orchard Bank also caters to those with a poor credit history. The Orchard Bank Platinum MasterCard offers a low interest rate on purchases. It also regularly reports to credit bureaus. This gives you a chance to use your card, pay off balances, and have creditors take notice.
Both First Premier and Orchard Bank cards include a number of fees. First Premier Bank charges initial fees of $29 and $95, as well as a monthly participation fee and annual fee. Orchard Bank requires a high annual fee.
These expenses may seem high. However, it is important to remember that these companies are offering cards to those with poor credit. Most bad credit credit card offers include extra fees due to the risks involved. Yet these cards are designed to help you improve your credit rating. Once you show that you can handle these cards wisely, you can apply for other offers.
Don’t let poor credit get you down. There are many bad credit credit card offers available. Choose the option that’s best for you and then apply online. With careful planning, you can improve your credit score. Soon you’ll be in good standings once again with lenders. This can open many more financial doors in your future.
By: Ed Vegliante