Jeffrey Slebodnick was hired last summer to work as an adjunct professor at a technical college.
He had a master's degree, excellent recommendations, and no criminal record.
"I was given four classes and I was excited to start the term," said Slebodnick, 47, from Perry, Mich. who teaches geography.
"But a week after I was offered the job I got a call asking if I had any student loans, which I did, and when I planned on paying them," he said.
Slebodnick says he was told he would not be allowed to start work at an ITT campus in Michigan, because a credit check revealed he had some $50,000 in outstanding student loans and had recently declared bankruptcy.
"He told me they wouldn't hire someone who defaults on student loans. It was a shocker to get that phone call and get those classes pulled from me."
Once just the domain of the federal government, banks and financial-service institutions, an increasing number of companies are screening potential employees' credit histories, trying to glean from the way candidates manage their personal finances insights into their character, integrity and work habits.
It's increasingly likely that a checkered financial past can cost you a job opportunity. This doesn't sit well with consumer advocates and was not addressed in the most recent credit refirm legislation passed by Congress.
"There are many reasons someone's credit might be bad including identity theft," said Margot Saunders a lawyer at the National Consumer Law Center. "It's not completely unfair to use credit screening in all respects. You would want to know if the person you're hiring to be a treasurer is deep in debt. But why do you need to know if the person is digging ditches or handling computers? There has to be some sort of standard."
Various factors, from student loans to a recent divorce, can affect a person's credit history and as a result hurt their chances at finding a job, experts told ABCNews.com.
In 2004, some 35 percent of American companies were checking potential employees credit histories, said Matt Fellowes, director of the Pew Safe Banking Opportunities Project.
"It is safe to assume that the figure has gone up substantially, given the massive growth rate and how hard the credit bureaus are advertising," he said. "Around half of all companies are likely to run credit checks."
There is a good deal of information potential employers can glean from an applicant's credit report, said Steven Williams, director of research at the Society for Human Resource Management.
A credit report includes an individual's credit history – the record of how he has borrowed money and paid in back -- as well as personal information employers use to confirm an applicant's identity such as a social-security number.
"There are several reasons why an employer wants to look at credit history, but the biggest reason has to do with responsibility," said Williams.
"Credit history gives employers sense of how responsible someone is. It shows if you pay your bills on time, if you're not taking out too much debt. It is one indicator of how responsible you are, and the assumption is that if you're responsible when it comes to your own money it will flow over, and you'll be responsible with company's money," he said.
In 2001, Slebodnick took $25,000 in student loans to pay for his master's degree. He took another $15,000 for a doctorate he never finished.