In today’s current economic climate, your job search and bankruptcy may not initially seem to be connected. After all, with so many people declaring bankruptcy – and with the sheer number of individuals searching for jobs – it’s understandable to think that prospective employers might be more sympathetic to bankruptcies, if not unconcerned altogether.
You may already know that declaring bankruptcy means that anyone looking at your credit score will see it for approximately seven to ten years, depending on whether you’ve filed for Chapter 11 or Chapter 13 bankruptcy. In some cases, you can see a bankruptcy drop off your credit report after a few years of financially responsible behavior. Yet some employers only see one thing when they discover a bankruptcy on your credit report: someone who has been irresponsible in their personal affairs.
It might sound harsh (and more than a little unfair), but in some industries, taking a look at a potential employee’s credit score is absolutely necessary (think banking, law, and accountancy). The logic behind it is this: if the individual is working in a finance-based industry, then he or she needs to demonstrate sound skills in that industry. However, you don’t have to be applying for a banking job to get your credit history searched by employers.
Under the Fair Credit Reporting Act, employers are allowed to search through a potential employee’s credit score to determine if they’re a viable candidate for the job. Although bankruptcy declares that employers may not discriminate against individuals who have a bankruptcy (Section 525), there’s no denying that employers may be hesitant to employ an individual with a bankruptcy on their credit score. Bankruptcy can have an effect on your job search efforts – and if you’re not careful of how you present it, you could end up losing out on a job offer.
If you have a bankruptcy on your credit report, and you’re asked about it during the course of the interview, be sure to frame it in a way that presents you as an individual who seeks solutions to problems. If you can spin the financial event into a positive characteristic, your employer may be more likely to see you as someone who is results-driven and responsible. Point out that although you fell on tough times, once you were able to get the fresh financial start that bankruptcy allowed you have been diligent in repairing your credit score.