Getting Short Sales Approved

Today on CNN they talked about these VERY interesting statistics.

Here are the highlights below:    (full transcript)

VELSHI: And one that we’ve had in the last couple ideas has been this — this idea that there are states or efforts to try and curtail the use of your credit report, your credit history by employers to make a determination as to whether or not you should get a job. But it is a widespread practice.

ROMANS: It really is, and I think most people don’t even understand this. Eighteen states — 25 different bills in 18 states in this legislative calendar, Ali, are trying to limit what your prospective employer can see about you.

A job applicant goes and applies for the job. Human resources or the owner of that business can run a credit check as long as they tell you. Sixty percent of companies do this; 13 percent do everybody as a standard practice.

VELSHI: Wow.

ROMANS: They just run a credit check on everybody. Forty-seven percent just do for selected candidates. Most likely, Ali, people who are going to be touching money, who are going to be running a budget.

VELSHI: Right.

ROMANS: Forty percent of companies just don’t do this at all. They simply don’t run a credit history. But it can be done, and it is legal.

VELSHI: You mentioned something. It’s legal if they ask you and you consent. When you’re in a job market that we’re in now, most prospective employees, people looking for a job, don’t think that they have the right or don’t think it would be wise to say no.

ROMANS: Right. And look, if you’re — if you’re going for a job in a money business, it’s pretty standard. Also, if you’re going for a job in some things that are licensed like day cares or in different states. There are different kinds of jobs you have to have a license, where they have to do a criminal and a credit check on you just to know who you are if you’re dealing with the elderly or you’re dealing with young people.

So, all of your information…

VELSHI: Yes.

ROMANS: You should assume all of your information is available to the person who is thinking about hiring you.

VELSHI: You did some research into what you are most likely not to get hired for as a result of somebody checking your credit.

ROMANS: Yes. OK, so this is a — this is from the Society for Human Resources Management. So, this is a human resources firm. Look, you’re not going to get hired because of a current judgment against you, a lawsuit, an outstanding order against you in the court of law; debt collection, uncollected debt, you’ve got a lot of debt out there. Bankruptcy, 25 percent of the hiring managers would look you over because of a bankruptcy. High debt-to-income ratio, much less and foreclosure (which is only 11%), even less than that.

Other Experts Chime In

MSN.com reported this recently.  I talked about this in my recent blog “Credit Scores Heal, Your Savings Account Won’t!”

Some employment experts say concern about credit checks is overblown. For one thing, they say, companies typically are far more interested in other kinds of background checks, including identity verification and criminal histories. (For more information on background screening, see “Secrets a background check won’t uncover.”)

Job applicants are much more likely to lose jobs because they have a recent criminal history or they lied on an application about their identity, experience or education, said William Greenblatt, the CEO of Sterling Infosystems, a New York City background-checking firm.

Employers are more likely to use credit reports as a way to verify employment history and Social Security numbers, Greenblatt said. Lenders often verify employment when you apply for a loan or credit card, so a credit report is seen as a good way to double-check the employers listed on a job seeker’s application.

Brad Veach, one of our advocates at www.YouWalkAway.com recently had a conversation with an officer in the military that actually makes decisions on peoples security clearances.  He said that “As long as the homeowner discloses to his superior officer (or boss) his mortgage challenges, the issues concerning security clearance and foreclosure (not bankruptcy) are typically overlooked.  They’re not that big of a deal.”   Bankruptcy is looked at as a bigger issue, due to the fact that it usually affects the entire credit picture.

To support this theory, If you can’t sell your home it doesn’t mean you are financially irresponsible.  It’s important to let your superiors know that you are doing something rather than nothing about the problem.  Many people who are in strategic default, are using their extra funds that are normally used for a mortgage payment to pay down other debts & keep themselves from financial ruin or bankruptcy.

In Conclusion

Don’t keep it a secret.  If  you presently have a security clearance and your employer finds out from someone else, it may create a problem that wasn’t really there.  Many people that make these employment decisions are facing similar problems with their own homes.  It may be much more favorable if you talk to them prior to making your decision to default.

Jon Maddux

CEO

www.YouWalkAway.com

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