Bad credit can have a variety of negative effects on your life. It can prevent you from obtaining future mortgages, credit cards and auto loans. It can also hinder your ability to rent an apartment. In some cases, bad credit can also have negative effects on your ability to secure and maintain employment.
Employment Denial
After you interview for a job, an employer may require you to consent to review of your credit report as a condition of a job offer. If you provide consent, your prospective employer may obtain and review your credit file. Employers in any industry may refuse to offer you a job or rescind an existing job offer if your credit report contains negative entries, including bankruptcies. However, a credit review is particularly important for jobs that involve handling finances or cash, such as insurance, banking and retail cashier jobs.
Work Performance
Bad credit may interfere with your work performance -- if you have poor credit, you likely experience stress caused by creditor calls and letters, inability to obtain loans for needed items and worries about how you will restore financial stability. Credit-related stress can increase fatigue caused by sleep problems, lead to work absences because of illness and decrease your ability to focus on work tasks. These factors can cause you to miss deadlines and produce substandard work, which can put your job in jeopardy.
Creditor Communication
Under the Fair Debt Collection Practices Act, a creditor may not contact you at work if forbidden to do so by you or your employer. However, your manager or human resources representative may learn of your creditors' attempts to contact you at work before you have the opportunity to forbid such attempts. Employers typically view creditor calls as a workplace disruption -- your manager or human resources representative may view you in a negative light and may begin scrutinizing your work performance to look for reasons to terminate the company's relationship with you.
Garnishments
If your credit payments become sufficiently delinquent -- usually six months or more -- a creditor may file a lawsuit to obtain a judgment against you for the debt. In most states, a legal judgment allows a creditor to obtain authorization to garnish your wages. Wage garnishment creates substantial paperwork for your employer, and the employer's payroll personnel must monitor your earnings to make sure the proper portion of your wages is sent to the court. Although you cannot be fired for one wage garnishment, federal law does not protect your employment status if your employer receives garnishment orders from more than one creditor in a 12-month period.
0 comments:
Post a Comment