Do the words “credit check” make your stomach drop? You are not alone! Many of us wound up with a little too much debt from time to time, especially when we were trying to raise a family or recover from the Great Recession. There may even be a blemish or two that we’re still working diligently to remove from our credit report—so the idea of a potential employer checking our credit can make us downright nervous. Especially when we are trying to prove that we are reliable enough to work at home.
Listen in, and I’ll let you in on a little secret about work-from-home prospects and your credit history – and explain how worrying about your report won’t do anyone any good. Instead I’ll show you what steps to take.
Is my credit history a problem?
Let’s break down the role credit plays in the hiring process and how you can better understand and control your credit report.
need to know
You might be wondering why these companies need to know anything about your credit, after all – you’re trying to make money work For them, you are not asking for a loan. And that is a great point. Sometimes the answer is innocuous – they’re using it as part of the background check process to make sure you’re who you say you are and not some super rich cat burglar who’s been lying around for a while under a fake identity. Other times, the answer is more serious – if you’re being considered for a position that deals with money (whether it’s company money or client money) or sensitive information, the hiring team may need assurances that you’re not in serious financial trouble. Straight that can compromise your integrity.
You read that right: some companies are trying to find out if they can possibly steal from them. They want to make sure you pay your bills on time and don’t have a history of questionable spending or payment problems. If you are responsible with your money, you must be responsible with them.
Some of the work-at-home jobs for which we commonly see credit checks run include customer service and sales positions, accounting and bookkeeping jobs, and jobs within the financial sector. Jobs that don’t often involve a credit check include teaching English online, freelance writing, search engine evaluation, and many small cash opportunities.
Here’s some good news: According to 2012, A study published by the Society for Human Resource Management revealed that 80% of companies that ran background checks on their potential hires – and hired the person in question – did so despite having some negative information on their credit report. So if your credit history isn’t great, it’s not the end of your hopeful remote career. You may even have an opportunity to explain any negative history during an interview and discuss stressful situations such as a spouse’s job loss or serious illness. Just be careful – insist that your circumstances have changed if you can and that you are committed to improving your credit report. You don’t want them to think you’re a bad bet.
Better news for some of you: There are some states that do not allow employer credit checks. Those of you in California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maryland, Nevada, Oregon, Vermont and Washington are forgiven. (However, your credit should be above that. Also, there may be exceptions to this restriction, so check with your state’s Department of Labor if you’re concerned about a possible check.)
If you’re still worried about running a credit check on you, remember that you must give them permission to pull your credit report. However, withholding permission by giving the impression that you have something to hide will disqualify you from consideration. Rest assured that if they decide not to hire you based on something on your credit report, they are legally obligated to let you know in advance and then provide you with a copy of the credit report.
Want to check out some work-from-home jobs that don’t require a background and/or credit check? I have a list of them for you Right here.
Know the score
Understanding your credit report and score and being fully informed about your credit history is the best way to protect yourself from any nasty surprises. You can make sure that whoever runs your credit check has an accurate picture of your credit, and you can easily be prepared if anyone — say, a hiring manager — questions you about a less-than-stellar credit report.
First, take your advantage Free annual credit report. Every twelve months, you are entitled to a free credit report from the three major credit bureaus Equifax, Experian and Transunion. By receiving your free reports each year, you can carefully review them in their entirety to ensure there are no errors or suspicious activity. This is a great first step in maintaining good credit habits and spotting any signs of identity theft.
If you notice any unusual items on your credit report, make sure you follow up. Contact the credit account that reported the incorrect information and ask them to correct the accounts. Once they do this, make sure they report the change to all three credit bureaus so the items are removed from your credit report as well.
So that you can rest easy so that your credit report stays on track, I recommend that you sign up for a free credit score monitoring and credit report analysis tool like Credit Karma. They’re a great choice for a complete look at your finances and credit: they monitor for credit changes, refresh your credit score every month, and even send you daily monitoring alerts when they find a change on your report. They throw in free identity theft insurance protection (up to $50,000). They complement their value by analyzing your credit card usage, outstanding debt and payment history, while offering you great deals on new lines of credit (whether for a card, home or auto loan) that best suit your financial situation. Along with their accompanying app, Credit Karma is an incredibly useful tool.
Improve every day
Finally, if your credit report is a serious concern regarding your job prospects, the best thing you can do is work through it. Two easy ways to start improving your credit report are to make regular payments on any credit card bills and outstanding debts and to make sure you don’t max out your credit cards. Having credit available but not used is good for your credit rating, and a reliable payment history also makes the credit bureaus more confident in you. Of course, easy doesn’t mean easy – when things are tight, paying that money can be one of the hardest things to do. But if you find a way to hold that line, you’ll see an overall improvement in your chances and notice that you have a little more breathing room.
I hope I’ve inspired you to take control of your credit report and go for the remote job you really want – even if you’re nervous about credit checks. Just remember to stay calm, work through it and you’ll be building your career at home in no time.