More companies are checking job applicants' credit reports. So if you know there's bad news lurking in yours, what do you do?

QI have a very good friend who has been unemployed for about a year. He feels -- and probably rightly so -- that many times when he goes on interviews or applies for a job, he is disqualified because of his bad credit report. It seems like a catch-22 because he is in this predicament because he can't get a job and he can't get a job because of the bad credit rating. He recently had a big interview with one of the major banking institutions and about halfway through the testing process, someone came in and asked him to leave. How does a person get out of this vicious cycle? Is it better to tell someone in human resources before you go for the interview about your bad credit rating, to forewarn them?

ARaymond Seghers, director of research for AON Consulting, an Ann Arbor, Mich., firm that advises corporations on a variety of employment issues, said that "it wouldn't surprise me that a financial institution would check" an applicant's credit report because that person may well be expected to handle money for the bank. Financial executives say they fear that someone deeply in debt could resort to theft.

Conversely, Seghers said a bad credit rating would have little or no impact with many jobs because no direct handling of money is involved. In any event, federal law requires companies to inform job applicants that they intend to get credit reports and to get their permission. In addition, the law requires companies to let applicants know if they wouldn't hire them because of what they found on the reports and to give them a chance to correct erroneous information. But here's the catch: The law does not require companies to keep a job open while an applicant fixes the mistakes.

In this case, Seghers said, "Yes, I would inform human resources" about the bad credit report. "You can't hide it. People can get on the Internet and check your credit rating in seconds."

That said, Seghers added, "I'm hoping a more enlightened company would take other factors into account and look at the totality of his employment record. One strike shouldn't equal out."

Seghers suggested he go to human resources and briefly explain the circumstances. "I would take the initiative to ask the HR person, 'Is this a problem or will the totality of my application be considered?' "

He said that by informing human resources of the problem and asking forbearance, he might get a

fair chance at his next job opportunity, rather

than having HR be surprised by the bad credit report.

-- Kenneth Bredemeier

E-mail your workplace questions to Kenneth Bredemeier at Discuss workplace issues with him Wednesday at 11 a.m. at