Newest Job Qualification — A Good Credit History

Alien54 writes quotes an article from The Day that says "In the past, only banks and financial service companies routinely ran credit checks on potential employees. But employers in other sectors increasingly are including [credit checks] in the screening process to assess applicants' honesty and integrity, traits not readily gleaned from a résumé. US employers' use of credit checks increased 55 percent over the last five years, according to Spherion, a recruitment and staffing firm with offices around the country.... "The credit check has become a general measure of responsibility and organization," said industrial psychologist Carl Greenberg, senior vice president of Spherion. "If you cannot organize your finances, how are you going to responsibly organize yourself for a company? Organization is a measure of responsibility."

Little Suzy.

So because Mr. Smith had to max out his credit cards for Little Suzys cancer medication, he doesn't get the new job?

Re:Little Suzy.

No, he doesn't get the job if he maxes out his credit cards and then never makes payments on them. Credit cards are meant to be used, they don't give you a bad credit history. It's failing to make payments that ruins you.

Re:Little Suzy.

Credit cards are meant to be used, they don't give you a bad credit history.

Are you kidding?

Between a set of people with perfect payment histories, credit ratings will vary dramatically. While credit is meant to be used, there are all sorts of magic (and often trade secret) formulas for determining patterns in your financial behaviour that will bite you. Maybe you always made every payment on time, but if you ever paid the minimum, or exceeded some unknown level on your credit, then your score suffers.

Re:Little Suzy.

Employers often are looking for the following things - collections, bankruptcies, foreclosures, and accounts not in good standing (24-month payment history, accounts being paid late, etc). Getting the credit score may be helpful, but it doesn't tell the entire story. And a credit report with the credit score costs more than a standalone credit report. An applicant with lines of credit is also indicative of someone who wants/needs job stability.

Re:Little Suzy.

Here's a fun one ... Federal law prohibits people you owe money to from calling your employer and telling them. Yet your employer can pull your credit report and see all of that information. Something needs to be fixed here.

Re:Little Suzy.

Screw that. I can understand why they might want to look at a credit report to determine how responsible an applicant is, but I wouldn't do it as an applicant. Maybe if the credit bureaus start dishing out a "responsibility score" that just gives them a number based, basically, on absence of negative information without giving them the information.

Except in special cases, my financial information is no business of my employer. I would never give my credit report to a prospective employer, period, unless they're going to give me a loan or something. If they have a problem with that, they can keep on looking for another candidate. And your example is also interesting... so the person wanted a part-time job and they initially didn't want to give it to her because it wouldn't be enough to pay her debts? If enough employers implement systems like that, it will make sure that someone that is in debt will be in debt forever.

Nope... candidates for jobs just need to say "no" to this trend. I've never been faced with it myself, but if I ever am then I'll just keep looking for some other employer.

Re:Little Suzy.

Question to thread: Please post information about these "trade secrets" and "magic". It would be interesting to see real, cited references.

You write that in what appears a sarcastic tone, implying doubt about my "statements". Yet these machinations of the credit industry are hardly hidden - a one-second google search yielded http://www.privacyrights.org/fs/fs6c-CreditScores. htm [privacyrights.org].

This yields nugglets such as-

The exact formula of the FICO and other scoring models is a trade secret

Points are given or taken away based on the amount of available credit used. Certainly, using the maximum amount on your credit card and paying only the minimum each month can lower your score. But, using a large percentage of your available credit each month, even when you pay the bills faithfully, can detract points if you are carrying a high balance at the time your credit history is scored.

...and so on.

Re:Little Suzy.

Yes it's very well known that a simple credit check (ie someone doing a credit check on you), whether landlord, bank or employer, in fact removes several points from your credit.

In BC here, almost every landlord is askig for credit info these days to run credit checks, and the housing market is F*ked - so in order to find a house you may have to look at 5-10 (or many more) places before you actually get one. If every one of these landlords does a credit check, your 'oh so good' credit ends up suffering a ridiculous amount just because you are looking for a house to live in.

Keep the poor down - it's the way of the system.

Re:Little Suzy.

Keep only one credit card... Never use it

Umm, wrong. I used to do everything you said, and the only reason I was able to buy my first house is because my wife had a better credit rating than me. Since then, I started paying for everything I can with my Amex card and paying it off, in full, every month. We just bought our second house a few months ago and my credit rating was a little better than hers.

The point is, having a credit card doesn't count, unless you use it.

But that's Catch-22

If you can't get a job, you can't make the payments.

This effectively relegates the poor to a permanent poor status.

I already told my HR department 3 months ago to never even think about this bullshit tactic or they'll be fired out of here like a friggin cannon ball.

We don't need credit checks for jack squat. We need criminal state & FBI background checks and that's it.

Re:But that's Catch-22

What if they ran up student loans and got laid off due to offshoring? That put a lot of people out of work for as long as 5 years, with their next employment being McDonald's!

Let me clue you in, pal... if everyone abstained from credit cards whose income was highly vulnerable, the economy would tank and your comfortable, pull-yourself-up-by-your-bootstraps universe would collapse anyway. Our economy lives and dies by consumer credit card spending: it is that huge a factor.

Medical bills, well that's even more fun. Every day I stare right at medical insurance policies as high as $800 a month for someone with pre-existing conditions. Now you tack on a student loan with that for someone who is getting a MBA (since all other degrees are unimportant in the corporate state), and you have someone who is ripe for another round of mass unemployment when MBA jobs start going offshore in 5 years (and they will, mark my words). Loans. High medical insurance. Oops.

BTW I have a FICO score of 803, with no bankruptcies and a bunch of empty balances. I used to pay rent on credit cards when I had no job, and I pulled myself out without missing a payment. So yeah, I'm probably better at this than you, and I still know what it's like for the working class.

Re:But that's Catch-22

I can see a medical problem causing problems with credit in the USA as the USA lacks a national medical care program, but pretty much any other credit problem can be solved easily if the payments are on a physical thing. Sell the damn thing. This doesn't help much with student loans.

Lost your job, and car payments are suddenly too high? Sell the car. Too much on the old credit card? Stop spending. Sell some of the toys. You'll take a loss, but you'll have more money for important payments like your mortage or rent. If renting think about moving into a smaller place if a new job takes a while to find.

Anyone with any sort of equitiy in a home or a good job should NEVER keep a balance on their credit card. Get a line of credit and transfer the credit card balance to it if you can't pay it off. This should be a last resort, not a normal thing. Only spend what you can pay at the end of the month. If you really want something - SAVE up for it!

Simple rules for credit:

• Keep enough money in the bank to live on for three months.
• Only have one credit card.
• Always pay off the whole credit card when the bill is due.
• Save up enough to pay for luxuries before buying them.
• Put 10% of what you earn into long term saving and investments.
• Live within your means.
• At least once a year do a budget
  • Total income after taxes, per month
  • Bills you must pay (rent, food, clothes, transportaion, medical)
  • What is left after the bills:
    • Savings (amount you save every month)
    • Fun money
    • Saving for new luxury, trip, etc..
    • Retirement and other long term investments
  • Don't spend more than the "fun money" per month on fun!

  Running a household is simple. It only takes small amount of planning and self control.

Re:But that's Catch-22

I find your argument dismissive and biased. While I can't definitively promote credit-check based employee selection, your argument provides almost no argument against the option.

I made my arguments against it quite clear. But here, let me clarify.

a) It does precious little to catch real criminals who might gank you.

b) It makes it impossible for people with poor credit histories to recover from it; therefore, those who are economically down in the dumps, are forced to remain there.

The first reason is a personal (to the company one). It's a net with really large holes. Credit checks stop the piranhas but let in the sharks. The second reason is a societal one. If this policy is left unchecked, it will create a more severe nationwide underemployment situation where many college degreed people will be left flipping burgets while their real skills languish and the real work force they were trained for, leaves them behind. This results in a severely inefficient economy, and inevitably, diminished consumer buying power. That last one is disastrous for the economy because diminished consumer buying power means less profits which means a recession, layoffs, and inevitably an economic collapse (okay, ostrich brigade, you can now ram your heads into the ground and tell yourselves such a thing is impossible). If McDonald's is, as you suggest, also justified in running credit checks, then the economy's collapse is not only possible in the current reality scenario, but it is also imminent.

c) Angry employees with no credit problems gank you, too. Why? Because they're angry. You're not even coming anywhere close to addressing that problem with credit checks. Your best bet here is to conjure up a more advanced psychological profile test because that would be a better predictor of what they'll do when they're ticked off, than a credit score.

That being said, I am in favor of a Federal law forbidding employment oriented credit checks totally. I wouldn't even let them exempt banking companies from that law; the neo cons would have to spend that last shred of public good will they have left, to make that compromise happen.

Re:But that's Catch-22

Thank the gods you added that sarcasm tag at the end. By the end of that post epic flames were ready to fly...

I can honestly say, many don't get out because they don't try, but I don't think that's the case with most. Most are plagued by a compounding of the effects of past mistakes. For example, a young girl who gets pregnant in high school, will often suffer compounded effects of the mistake of not abstaining or using birth control. First, when the child is born, she is forced to drop out of school. Next, she may need to start working in order to support the child, well it's hard to get a decent paying job with JUST a high school diploma, just imagine what it must feel like without one. Now, she doesn't have a diploma, she's working a shitty job, she can't afford daycare, etc... Some slimey bank lends to her, at 33percent interest and $23 a month "membership fees"(yes, they do this, it is legal) and she takes it at a despereate moment because it's the only card she qualifies for. She'll never be out of debt now, she'll be making late payments because she likely didn't read the fine print about monthly membership fees, the outrageous interest rate, the $50 late fees, etc...

So now instead of just having no diploma, she now has bad credit to worry about in the job interview process(even while her banks is raking in big bucks off her through outrageous ineterest rates and late fees). And one of those fucktards will want to reply right now and say some shit about that's what she gets for being stupid and getting the card, having no clue, because mommies tit was always there when they needed it, what it's like to be on your own, single and poor with rent to pay and a mouth to feed. People make bad descisions when they're young and scared. Hell, people make bad descisions when they're old and scared. Look at the Bush supporters, at least half of them didn't support him according to the polls until they were scared by 9/11. I think that proves my point empirically about people making dumb descisions when they're scared.

Our financial affairs, unless we've been found liable or guilty of wrong doing by due process in a court of law, should not be any of our employers business, except in specific cases were specific relevance can be established. Meaning, no vague bullshit about how credit records show how responsible you are.

If I found myself in a situation where I could feed and clothe my kids or pay my visa bill on time, I'm going to feed and clothe my kids. Any fucktards who thinks that's a sign of me being irresponsible should not be involved in the hiring process of any company.

Re:

Is that really what happens in America??

Perhaps, then, the employee is choosing to disqualify themselves by showing sufficient lack of common sense that they voluntarily live somewhere without a health care system?

Forget little Suzy

At least, the father of little Suzy exists. For all practical purposes, I don't. It has been indicated to me (and I checked it) that I don't exist in any credit-reporting databases. My SS number and name are nowhere to be found.

How was I able to achieve such a feat? Even since I came to the US back in 1995 I always paid in cash or personal check. Some large amounts, such as school tuition, were paid by check; everything else - including rent and car - by cash. For online shopping, I use my debit card. At one point I was stupid enough to apply for a credit card, at which point - having no credit - I've chosen a secured credit card. I haven't gotten it because the bank (Chase) couldn't verify my identity, despite me sending in the copy of my driver license and SS card.

At this point, I've got a good job. As such, I don't consider not being able to get another job to be high enough price for being outside of the credit system.

Re:Little Suzy - Wrong!

Seems a pretty legit factor for employment to me.

What if some staffing consultant company one day decided that people who eat bran for breakfast are better employees (they're in cahoots with the bran industry, after all, serving each other's interests. They want to make sure you really suffer if you haven't been a fan of bran), therefore they're going to do a bran profile of all employees.

If you don't have enough bran in your history, sorry - no job for you. I guess you'll have to beg to try to start getting some bran.

Oh but don't think you'll sneak around this: They're going to do hair sampling and talk to former roommates to determine if you ate bran years ago. Simply towing the line now isn't satisfactory.

Maybe they'll do a "former lover" test to determine if you called within 6 days, and how your performance was in bed. Surely some loose, anecdotal correlation can be drawn there as well.

Sounds sort of arbitrary and ridiculous, doesn't it?

Because it is. It would be one thing if an unbiased research paper drew a strong/strong correlation between credit worthiness and performance on the job, but simply taking the word of a guy who's agenda is being served. No thanks.

Here in Canada there have been some efforts to ban any industry (for instance car insurance companies determining your rates based on your credit worthiness. Sure, they can say "Oh, but people with bad credit are more likely to be worse drivers!", but failing actual credible results, thankfully most people say "bullshit") from using metrics that haven't been positively and strongly correlated with the result they're trying to test.

Re:Little Suzy - Wrong!

My first job out of college in 1992 (during a nasty recession) was as a car salesman. I almost didn't get the job (and then of course, I was asked to quit after two months because I was so lousy at it). Anyway, during the interview, the guy asked me if I gambled or did cocaine. I said "of course not" ... which was true BTW. Then he shook his head a bit and siad that the people who have expensive habits like that often make really good salesmen because they really need money.

Bull Shit !

"Nope. If Mr. Smith mazes out all his credit cards because he didn't buy proper insurance for little Suzy,"

The majority of bankruptcies are caused by medical bills, and 74% of those HAD insurance. So FOAD with the blaming of people for not having insurance. Between co-pays, non-covered items, incidental expenses, no coverage for pre-existing conditions (which can be used to deny everything except a fresh gunshot wound if they really want to stretch it) ... they haven't got a hope in hell.

Think of it. 74 % are being told to FOAD. So stop with the "its their fault because they didn't buy insurance" bullshit, and get behind a public insurance plan that covers everyone.

Re:Little Suzy - Wrong!

The vast majority of people in the world can't afford proper food or housing, let alone insurance. We've got enough systems in place to keep the poor stuck where they are, we don't need another one.

Re:Little Suzy - Wrong!

You've never had a medical problem beyond the flu have you?

Little suzy gets bitten by a mosquito. She suddenly can't go pee after a few days. You go to the doctor and discover she has encephallitis and will die. They go nuts trying to save her, in the process they discover she now has hemophellia. They start popping in drugs that cost $21,000 per dose into her to try and stop the bleeding. Next thing you know you owe them $2.0M dollars.

They put a lein on your home because you're not paying fast enough.

Some of the doctor offices, but not all of them forgive the debt. Apparently the state run one feels you should pay back more than your home is worth.

Don't think that happens? Think Again [newsobserver.com]

Have you ever tried to get private health insuranc

Have you ever tried to get private/individual health insurance?

Seriously.

It can't be done.

In many states there's ONE carrier willing to issue individual health insurance, and it typically eliminates anyone with a "pre-existing health condition." You might think you're in the clear on that, but very, very few people can reach their mid-30s without having SOMETHING that they can use to deny coverage. I think in some areas NOBODY is willing to issue individual health insurance policies at any price.

When my COBRA ran out a few years ago the only insurance coverage I could get was the state-mandated "insurance of last resort". I was willing to make the sacrifices for the coverage, but most people couldn't since the premium was nearly half my mortgage payment. Fortunately my car was paid off and in reasonably good condition.

Our health care system is seriously screwed up -- did you know something like 47 million Americans are without insurance? It is absolutely inexcuseable for an industrial nation to not have, at a minimum, universal catastrophic health insurance to cover basic care for cancer, heart attacks, etc. People could still have private insurance for private hospital rooms, more exhaustive treatments, etc. It would be far cheaper for everyone involved than forcing doctors and hospitals to absorb massive losses on the uninsured and being forced to pass those costs onto everyone else (disproportionally hitting other uninsured patients since they can't negotiate capped prices), to say nothing of eliminating millions of bankruptcies caused solely by medical expenses.

(Don't get me started on people without insurance being forced to use ERs as 'urgent care', creating long waits for the rest of us and driving up costs since an ER visit is far more expensive than an RN and doc in a storefront office.)

Re:

This is a direct result of government being entangled in the economy.

No, this is a direct result of business controlling government rather than the people.

so, chicken or egg?

So, what if a candidate's credit history is a result of not finding a job. I've seen stories of (especially) IT people with long careers summarily right-sized out of their jobs. I've read articles (Enron?) of employees who lost their life savings and retirement funding because of (ironically) mismanagement at the top.

So now a candidate must show good credit? WTF? And if a candidate is in this financial situation because he (she) can't get a job, an employer who dismisses such candidate because they have bad credit perpetuates their situation. Shame on them!

From the article:

Federal laws require that companies notify job applicants before conducting credit checks, butmany (sic) firms reason that viable applicants with good credit have nothing to hide.

I call bullshit. This is an unadulterated power play and invasion of a candidate's privacy. And I suggest all out there looking for work decline the credit check as a part of the interview process.

I also think some public vetting of companies who use credit checks as part of the interview process would be interesting.

Re:so, chicken or egg?

I say that any candidate should be allowed to examine the personal finances of the C*O executives at the company she's applying for - you know, just to make sure something like an ENRON doesn't pop up. And hey - a good C*O should have no problem with it, right? Nothing to hide and all that.

Moo

Major points:

Companies are relying on credit reports because employers, afraid of being slapped with libel suits, are no longer as candid about the performance of former workers.

but are looking for other information...the identity of a person...full legal name...A lot of people change their names if they have something to hide, and it lists former employers who might not be named on the résumé.

Insurance companies have been criticized in recent years for using credit information to set individual homeowners insurance rates.

35 percent of US employers were checking credit reports in 2004, up from 19 percent in 1996.

The Massachusetts Public Interest Research Group supports legislation that would freeze consumers' credit reports, making it unavailable to a range of people and organizations. A similar measure, introduced after ChoicePoint Inc., a personal and financial data collection firm, reported that it had mistakenly sold the financial information of more than 145,000 to a group of criminals, died in committee this year.

Re:Moo

"but are looking for other information...the identity of a person...full legal name...A lot of people change their names if they have something to hide, and it lists former employers who might not be named on the résumé."

Prospective employer # 1 : "Gee, look at this. That last woman we interviewed, Mary Roe, the one we want to go with? Says here her name used to be Mike Row. Forget "it". Next!"

Prospective employer # 2 : "Gee, look at this. It says here that Joe Blow maxed out his credit cards last year for chemo for his wife. We don't want him raising our health insurance premiums. Next!"

Prospective employer # 3 : "Gee, look at this. The credit report lists Janet James as having a dependent child, but no husband. We don't need sinners like that here. Next!"

Prospective employer # 4 : "Gee, look at this. This credit report lists that Wilma Flinstone is claiming Betty Rubble as her spouse. Do we really want a lez in the office? Next!"

Prospective employer # 5 : "Gee, look at this. This credit report lists that Fred Flinstone is claiming Barney Rubble as his "domestic partner". Credit card bills show they were married at Stoney Creeek Lodge last year. I don't want some guy looking at my ass. Next!"

Prospective employer # 6 : "Gee, look at this. The credit report says that the reason for Nancy Crow's falling behind for a few months was she quit her job and sued her previous employer for sexual harrassment. She's probably a butch anyway. Next!"

There's more to business than just the bottom line. Treat people like crap, and you'll end up with crap people, and that WILL be reflected in your numbers eventually. And btw - while all of these forms of discrimination are illegal in any place with sane laws, #1 - the unwanted "outing" of a transsexual, either by the governments' program of informing employers about mis-matches between the gender associated with a SSN and the gender of the worker, or a credit check that is too invasive, places transsexuals at serious risk for becoming victims of physical violence, over and above any concerns of job discrimination.

A perfect example

of the rich getting richer while the poor get poorer.

Do you think the employer wants to hear the part about the divorce and paying alimoney and child support? They probably don't care about that part...

Definately not a utopian society we live in.

O rly?

I had my identity stolen years ago and my credit was ruined.

Does this mean that as a victim, employers are allowed to victimize me by denying me employment? Yep.

I've said it once and I'll say it again: Laws exist to protect big business, politicians and the financial top 1%.

So reform your democracy

If it doesn't serve you, change it.

Or, you can sit back, fat and happy and allow the guys at the top, the ones with the sociopathic personalities and pathological need to win, to decide how you're going to live.

 

Re:

"That's assuming they tell you."

They have to, by law. Even if they didn't, you would see that they accessed your report when you get a copy of your yearly free credit report.

Bad credit != Poor

I know plenty of people who have money and bad credit. Credit reports have been used for more than a decade to analyze risk in situations like employment. This is nothing new. You don't have to be rich to avoid having bad credit; you merely have to honor your financial obligations. Granted, there are some cases where you can be in good shape and something like sickness appears and the next thing you know, you're in financial trouble.. and this is more of a testimony to the neglect the government has towards the problem with healthcare. If this is the only ding you have on your credit report, employers can note the distinction between a medical related debt and something like consistently missing your mortgage payment.

How did credit evolve

Is the good credit history from rich parents or hard work.
Is the bad credit history from circumstances outside your control, or the inability to control spending.

Most people I interact with have no spending control, they blame their poor credit on things happening, not their failure to have an emergency fund, or that they eat out 4 nights a week, have 2 cars, a boat and a pair of motorcycles.

Re:How did credit evolve

I can't make any judgements about the average-joe-with-bad-credit, but for myself (I have a "medium - low" score, it's not absolute trash, thankfully), I can say that while it certainly is my fault, I seriously question that it would have anything to do with how responsible or hard-working I am. The reason is that I incurred 90% of the damage to my credit while I was 18 and stupid. Yes, at that time, it might be true that I was irresponsible and would have been a bad employee (although it wasn't, really). I just had no idea how to deal with anything in the real world because it had never been a concern before. Some people might claim that if I'm a "new person" now, with my life and finances in order, I should be able to recover quickly. Since I'm in school and not making much money however, those debts are not going away soon. Nor do you find credit card companies to be quick to forgive. I think it will be at least 10 years before my credit is really on the mend, and I don't begrudge the lesson that high interest rates, etc will teach. But I think denying me a job on this account is quite out of order. In short, it presumes too much.

Staff from strength!

Drucker once wrote that you should seek to staff an organisation based on the strengths you could find, not the lack of weakness, because that way led to (at best) being average.

Who cares if your R&D department cant remember to pay their bills? If they are good enough it'll be cheaper to hire someone to handle all that tedious interfacing with the real world while they prove that P=NP and engrave the steps onto the back of an atom using a method they developed in the bath.

In fact the business world *already* does this. The reason I have a purchasing department and a finance department and a contracts department is because I, as an engineer, am more valuable when I can forget about problems which are more efficiently dealt with by someone else.

Now I tend to pay my bills mostly on time, because it's the lazy option. I can even see how this might be a valid test for someone who was going to work in commercial or administration. But for most staff? Work out what the job needs to be sucessful and then ignore the other flaws - after all, managing flawed but brilliant people is why you have middle management and a HR department, employing their strengths to make you money.

Foreigners?

I'm an international student studying in America. My credit rating is therefore practically zero, because I have no fixed long term address in the USA, few assets in the US, etc. To get a contract for my mobile phone I had to put down an extremely large deposit precisely because I had no credit rating. One of my concerns would be it can take a very, very, very long time for someone in my position to build up a good US credit rating, if even my rating at home is quite good...

credit card

Get an American Express for students credit card. They'll give it to you. Use it responsibly (i.e. don't forget to make a payment every month), and watch your credit rating rise ... I've done the same, and got to a point were every week I was getting ~2 to 3 new card applications.

Big Suprise

It's another example of ways to keep the poor... well poor.

And I'm not typically the type to rag on that bandwagon. But lower income families typically do not always have the luxury of being able to manage credit. Especially not in a way that would result in a good great rating.

This also doesn't take into account things that were beyond the control of the potential employee. Unless you are going to allow potential employees to speak up for the problems on the credit report, then I see this as discrimatory.

Strike that. I find it discrimatory period.

I'm a damn good employee at work, but my credit rating is horrible. I've fallen on my face too many times and have struggled to get back up. I hold myself above water now, but not enough to even begin repairing my credit. If something happened and I lost my job tomorrow, not being able to find new employment isn't going to help that situation.

Re:

Financial status has no impact on credit. I know people who live at/below the poverty line but have fine credit. And, I know people with 6-digit incomes who have terrible credit.

Poor != bad credit.

Unable to control spending and poor risk management ==

Re:

Oh I agree. Poor != bad credit. But those at the poverty level and below sometimes have to make choices that will affect their credit to "get by".

How can you penalize someone who may have messed up their credit score for this reason in the same way as some

Re:Big Suprise

What's wrong about discriminating against people with a history of making bad choices?

Because for people living between a rock and a hard place all choices look as if they were bad to those who have never been there.

Re:Big Suprise

How is this any different than saying that lower income families typically are unwilling to live within their means?

Try "unable to live within their means". Housing, fuel, and health costs have skyrocketed while wages have stagnated or even declined.

If you can't afford to have a baby, perhaps you shouldn't be risking it, and so forth.

Don't be an elitist ass. Shit can happen to you no matter how well prepared you are.

Tv's and air conditioning aren't 'necessities'.

Read up on this summer's heatwave and you'll find dozens of people died because they had no air conditioning.

Nor is steak(or any meat for that matter)

Hardly. A pure carb diet is very unhealthy, and a great ticket to obesity and diabetes.

Credit history concept is flawed

The entire credit check history idea is wrong, not just when used for filtering job appplicants. It builds on the notion that those who pay their debts are more reliable, completely ignoring several key facts.

For instance, it "paints over" the problems of people who structurally use debts to pay back earlier debts. In other words: you can easily dig a hole as deep as you want, provided that you are sufficiently clever at hiding it by moving it around.

It also ignores those who do not want/need to have debts at all, as they simply have no "history". Never mind that Mr. X has had enough money of his own to survive for years and has carefully built this position by working hard from day one and by never spending money on stuff he didn't need or couldn't afford. I'd argue that people in this situation are much better at keeping track of their money and spendings than those who have payed back debts everywhere.

Police Officer

My buddy wanted to be a cop, long story short his credit was bad because of his friend, and when the did a credit check they told him he cant have the job.

Turns out you're most likely to accept a bribe with bad history.

Illegal credit checks

Federal laws require that companies notify job applicants before conducting credit checks, butmany firms reason that viable applicants with good credit have nothing to hide.

When a company does a credit check, it is listed in your report, so this is just another reason to look at your credit report as often as possible. If I were to find that a company I had interviewed with had checked my credit without my knowledge and I didn't get the job, I would certainly be in contact with a lawyer or the attorney general.

Stupid tool

I was an irresponsible youth with a drug habit once upon a time. During that time, I managed to ruin my credit rating pretty thoroughly, and it remained tarnished during the period when I'd got my shit together, and was working in the IT industry as a credit controller. I was extremely good at my job, which was enforcing business to business credit terms, despite having shockingly bad personal credit. Professional ingetrity and the ability to manage your personal affairs aren't necessarily related. I don't rate this as a valuable selection tool.

It's gone way beyond that already

Choicepoint, the parent company of company which was in charge of purging the voter rolls in FL of convicted felons, offers a range of employee background checks: criminal background checks, motor vehicle records, credit reports, employment verification, educaion verification, license and certification verification, reference background checks, and drug testing.

All of which sounds, on the face of it, reasonable. But employees should be able to see the information being provided to the employer and have the right to challenge it. For example, identity theft can permanently ruin your credit reports. Even if the credit bureaus fix your credit report, there are reports that the companies' data mining efforts repeatedly undo these fixes. Which means that once information is falsely associated with you, it can come back to haunt you at any time, no matter what you do.

Personally, I think a fix for this is that if companies want to provide information to third parties without your consent and without your ability to review it, then those companies should be held financially liable for any damages to you. That would light a fire under them to correct any problems. Right now they have no incentive to remove incorrect but damaging information about you. In fact the opposite. From their perspective a high false positive rate on identifying negative information about somebody is not a problem. So, their customers didn't hire that guy who would have been great. How will they ever know? But false negatives have a huge impact: if they hire somebody who checked clean, but he turns out to be a shoplifter, they'll never use your service again.

I think a better business model would be for the companies to be hired by the worker, not the employer. In that case you'd waive any rights to sue for damages in your service agreement, but in return you would be in control -- within limits -- of your information. When you apply for employement, you give the reference of a respected background check company. It'd be like applying to graduate school: your college sends a transcript which is "official". It may contain details that you'd rather hide, but there's no chance there's anything in it that will surprise you.

Finally, I should point out that companies are now in the business of providing highly detailed information about individual consumers' behavior and spending habits. It's only a matter of time before companies using this data hit on the idea of using the same services to figure out what a prospective employee is like. Imagine: your prospective employer finds out you like to buy guns, including automatic weapons, and and weirds him out.

The problem with these services is the same. They gain their popularity by the incredible depth of detail they provide about you; however there is no real incentive to remove false data.

Why this is a problem: 5 scenarios

One can have bad credit or credit problems for any number of reasons that have nothing to do with one's honesty, ability to do work, or even that are not your fault. If you don't pay a bill there may be any number of reasons. One may have forgotten something. One may have a dispute with the merchant. Or something may have gone wrong.

Scenario 1: Let's say you're working somewhere and don't have health coverage. You don't make a lot of money, and you can't afford to buy health insurance. You get laid off or fired and can't pay it any longer if you had it. And you get sick, or you have an accident. Or let's say you have health insurance, but there are gaps. Or you have a pre-existing condition and it's not covered by your health insurance. Let's say you are fixing something and drop a tool, and it cuts you. Or you get hit in the crosswalk by a guy who has no insurance and is judgement proof. Or you're attacked by a mentally ill homeless person. Or some emergency happens. So you go to the emergency room - federal law mandates they must treat you even if you can't pay, or they can't be reimbursed by Medicare - and fortunately the injury is minor and you won't suffer permanent damage or disability. Now, you're okay, but you can't pay the bill, which will probably run a minimum of $600 from the hospital, plus perhaps another $200 for the E.R. doctor's bill. Maybe a few incidental items bring the total bill to about a thousand bucks. Maybe you qualify for the hospital to pay some or all your bill from their fund for the uninsured - some have donation plans where people give money for this purpose - but you have to know about it and ask about it. If you don't, they're not going to tell you it's available.

Guess what, when you can't pay, they're going to report you! Now, not only do you have bad credit, a place that looks at your credit before hiring you isn't going to hire you because you have unpaid bills! Now you're unemployed, and can't get work because you're not employable because of your bad credit history! Watch from there as things get worse as you can't pay your bills and have even worse problems. And forget about asking to have a comment inserted into your record, it won't make any difference, creditors and the people who get these reports will no doubt score these things electronically so that the computer will scan them, a person won't, thus, nobody is going to see it and they won't hear your side.

Scenario 2: Consider this: you're late on one $20 payment on your Sears credit card, and it could cause some company to refuse you a loan to purchase a house, because your credit isn't "pristine." This actually happened in the case of one man who had been seeing Europe for a few months, came back and went to buy a truck after he totalled his car, and needed to finance it because the insurance settlement was for the depreciated value and he couldn't pay cash for the remainder. Seems he left money with someone to pay his bills while he was overseas, such as the utilities and such while he was out of the country, and instead of paying his bills they spent the money. Even if he can get the money back it's irrelevant; he's still got some issues on his credit report. Even if he pays the creditors back, with interest, he's still going to have a bad mark on his credit for several months until the reports clear.

Scenario 3: A nice old lady, next door to me, put me on her credit card as an authorized user with a card with my name on it back a few years ago so I could rent a car when she wanted to go on vacation and needed someone to drive her around (she doesn't have a license, and I didn't have a regular credit card (most car rental companies won't take a check card or other debit card even if you have enough money). I forgot about it otherwise. She died. She owed the credit card company money, about $20,000. They put a black mark on my credit report even though I'm only an authorized user; I'm not responsible for the bill. While I sor

Screw them all.

Credit card companies, credit reference agencies and debt collection agencies deserve everything they get. They all live off people's missery. Would the world be a better place without them? Oh yes.

Due to redundancy, taking a new job close to family on lower wages and getting my partner pregnant, I fell into debt. For three years I learnt to play the game. Soon I will play the game again.

Note that I have no idea how to play the game in the USA nor would I want to.

1. Register with a debt charity. There are plenty. Listen to their advice but do not act on all of it.

2. Arrange low payment plans. Tell them you are registered will a debt charity. Tell creditors that you need £20 a week to spend on alcohol. £20? Oh yes. I don't drink but the game says you can claim this as a reasonable living expense. Cigarettes, no. Booze, yes. Amazing. Yearly holidays to visit family are also reasonable. They will stop the interest payments at this stage.

3. Move house if you are renting. It's easily done and will buy you another 12 months.

4. Save the money you would normally use to pay creditors monthly. Don't give them a penny.

5. Change your phone number. It's easlily done. Tell the phone company you are being harrased nightly by creditors. Everything should be done in writing.

6. Stand in front of a magistrate. It's scarey but it will buy you more time before the baliffs come knocking.

7. Demand to see the credit agreements you signed. Some creditor are so sloppy that they cannot find their own records. It will buy you a few more months anyway.

8. Finally, a few days before the baliffs come a knocking, phone your creditors. Offer them a settlement figure of 50%. You have the money because you've not been paying them for 24 months (see point 4). They ALL accept 60% but 50% is a good starting figure. Tell them you've just sold your car and if they don't take the money you'll spend it on a new car.

9. After you are debt free apply for a credit card. All greedy credit card companies will give you one. Use it the pay for the weekly shopping and no more. Pay it all off. Now you've just saved a month's worth of shopping bills.

10. Get your credit limit increased. Take out personal loans. Lather, rince and repeat and save yourself 40% on all your big purchases.

It takes brass bollocks at times but it's all part of the game.

Employ me or not. I can survive just fine without your job.

Check garnishing

This is more likely to do with the new bankruptcy laws. Now that the credit card companies can garnish your wages post-chapter-11 it's likely to become company policy across the board.