Bad Credit/Debt impact on applications?

**tyminn** · 08-19-2012, 12:57 AM

I did a search and didnt find any questions relating to this topic. Does anyone have any experience or info regarding the impact of bad credit on acceptance and or funding. I supposed the background credit check run by different programs vary greatly. If it is the case that they run one and find bad credit, past defaults ect, does it have any impact on funding offered or decisions in general? Thanks.

**Walras** · 08-19-2012, 05:38 AM

I have no inside info on this, but it doesn't make sense to me that this would matter to them. I mean, after all, they'll be paying you so they don't need to worry about your ability to repay your debts or how deep those debts run. A much better person to ask, though, would be your dept. secretary (if you're dept. has a graduate program). Even professors, unless they've served on the admissions committee, may not know the answer to this one, but if they do run credit checks the secretary probably gets stuck with that grunt work.

**anonecon** · 08-19-2012, 07:39 AM

I would be shocked if they ran credit checks. Though, that would be really interesting.

**tm_member** · 08-19-2012, 03:05 PM

Criminal checks possibly, credit scores unlikely.

**tyminn** · 08-19-2012, 03:31 PM

Thanks. I was just going to ask then, if they actually run the checks .As that would certainly make bad credit a non concern.

**OneArmedEcon** · 08-19-2012, 07:27 PM

In order to legally check someone's credit, you have to give explicit written permission (before I went back to grad school, I worked as a Purchasing Agent and would occasionally run credit checks on prospective subcontractors who did business as individuals). In most states, it needs to be a dedicated, one page form that is written in clear English. That is, it's unlikely that it's something that they sneak into some general terms form that you click "I agree to" online without really reading. Also, you can get into a lot of trouble by running a credit check on someone without their expressed written permission, so I doubt that schools would risk that (plus it costs $10-15).

Now if you're applying for an immigration visa, it may be different and I have no knowledge of those procedures other than a general sense that financial self-sufficiency/wherewithal is one of the criteria for granting a student visa. But in terms of the admissions process, I don't think that it's something that you have to worry about.

On the other hand, when you go out onto the job market, prospective employers may look at your credit report.

**Humanomics** · 08-19-2012, 08:19 PM

Originally Posted by tm_member

Criminal checks possibly, credit scores unlikely.

At least they won't make you write an essay about your offense like some UG applications. That was a blast. Ha.

**Humanomics** · 08-19-2012, 08:32 PM

Originally Posted by OneArmedEcon

In order to legally check someone's credit, you have to give explicit written permission (before I went back to grad school, I worked as a Purchasing Agent and would occasionally run credit checks on prospective subcontractors who did business as individuals). In most states, it needs to be a dedicated, one page form that is written in clear English. That is, it's unlikely that it's something that they sneak into some general terms form that you click "I agree to" online without really reading. Also, you can get into a lot of trouble by running a credit check on someone without their expressed written permission, so I doubt that schools would risk that (plus it costs $10-15).

Now if you're applying for an immigration visa, it may be different and I have no knowledge of those procedures other than a general sense that financial self-sufficiency/wherewithal is one of the criteria for granting a student visa. But in terms of the admissions process, I don't think that it's something that you have to worry about.

On the other hand, when you go out onto the job market, prospective employers may look at your credit report.

Here's a question: who knows anyone who's taken their econ training over to Experian or Trans Union? I've heard their algorithms are atrocious, and data cleaning worse. It's like the GRE for the middle class!

On another note -- you would be really surprised at how little coordination of centralized information there actually is in government and business. That's not the libertarian in me talking -- dats deez streets, nilla. Cross-checking identification, background, and other information is extremely costly -- not just in terms of the prices background checking and data reporting agencies charge, but in terms of how difficult it is for them to keep track within and among themselves. And the system gets more complex even as central data processing technology advances at an exponential rate. So the idea that you're being watched and checked-up on by authorities is usually more of a superstition than a reality.

I worked for a guy who was getting an MA and cheffing at the same time -- he was pulling down 40 or 50 cheffing, and reporting below poverty line on FAFSA. You'd think the IRS cross checks with FAFSA. You would be incorrect. Say you get pulled over in another state other than your home state -- that officer, even with his neato torpedo little Tough Book mounted to his dash, can get virtually no background information on you. Every national security (whatever that means) disaster we've had has been blamed on the failure of information agencies to coordinate with one another.

The world is an honest place because 99% of people are reasonably ethical -- take that new institutionalists.

**Ondrej** · 08-19-2012, 08:39 PM

I read recently about Cambridge or Oxford doctoral programs, not sure which one, and they stated specifically that the financial situation of the applicant has no impact on the plausibility of his acceptance into the program.

I guess it's gonna be the same in the US.