Background Checks and Your Credit – Blog

Your credit doesn’t just matter when you want to borrow money; it has an effect on how and where you earn it, too. Many employers do credit and background checks before making a decision to hire. In some cases, they wish to ensure that you are being truthful on your resume — not surprising, as almost half of all resumes contain at least one instance of someone stretching the truth. In others, the job may require security clearances, and they want to make sure that you qualify for them. Many employers also want to see a good credit rating, since many people believe that it correlates with reliability and good job performance.

What Can Employers Look At?

The Fair Credit Reporting Act (FCRA) dictates what can be included in a background check. Reports are truncated so that medical billing is obscured; the reason for this is medical privacy laws. An unaltered credit report could inadvertently reveal private medical history that can cause discrimination. Employers need to get your permission before viewing your credit history.

As part of a background check, most companies will also want to verify your employment history. While this can sound intimidating, it usually just involves checking your references. This is done to make sure that the dates that you provided match up with what the employer hears when they check back with the references you listed.

In some cases, employers will also want to check your criminal history, usually in security-related jobs. Some states only allow employers to look back a set amount of years, others have records that are more open. If you are applying for a security-related position, you will generally need to submit to a check of your full criminal history.

How to Make Sure Your Background Check Brings Back Your Best You

The first step to take is to always maintain good relationships with at least a handful of people at each job. Connect on sites like LinkedIn so that you can find each other in the future to provide employment history verification for one another.

Next, pull your credit record so that you have an idea what a potential employer will see. Get inaccurate negative items removed. For everything else, provide an explanation that potential employers will see when they look at your report. This shows that you are conscientious and working to fix past errors.

If youthful indiscretions have left a criminal record or two, find out about having those records sealed or expunged. The process can take some time and some money, but, this is often made back in future earnings that you may not have access to otherwise.

By ensuring that your background check presents the best possible version of you, you increase your chances of landing the job that you want and open up your financial future.

Controversies Regarding Credit Scores and Credit Reports

Credit scores are a quick and handy shorthand that banks and other potential creditors use to assess their risk before loaning money. But, as is common with shorthand systems, they are also prone to a number of flaws that can negatively affect you, the consumer.

There are actually a number of controversies surrounding the use of credit scores and credit reports. Some states have proposed legislation to give consumers more protection. Some of the issues with credit scores that can hurt consumers:

Possible Errors in Credit Reports

Experts estimate that 79% of all credit reports contain errors. While most of these are innocuous errors regarding employment or past addresses, others contain negative marks that can lower your credit score. And, when there is an error in your credit report, you are presumed guilty. You, or a credit repair specialist working on your behalf, must initialize investigations into erroneous reportings. In some cases, inaccurate data has stayed on credit reports long enough to begin legal action.

Non-Credit Uses of Credit Scores

Credit scores are not just used for assessing credit. They are also more and more commonly used when you are seeking employment. This has become even more common, and more damaging during the economic downturn. Many worthy applicants are turned away because economic hardships have left them with less than perfect credit histories. At least seven states have put laws into place banning employers from pulling applicants credit reports or limiting what information employers can see.

Further, there is little evidence that credit scores and credit reports are a good indicator of employment performance. Representatives from TransUnion admitted that they had no figures correlating credit score and worth as an employee. A study done by the New York Times failed to find any relation between the two.

Complexity of Credit Scoring Process

The truth is, no one knows exactly how the credit scoring agencies arrive at your credit score. The work involves complex computations that are largely kept secret to avoid gaming the system. Credit reporting agencies have shared the how each section is weighted; however, the exact figures are kept secret. This has led many consumer advocates to criticize credit reporting agencies for a lack of transparency.

Variations Between Different Agency’s Scores

The version of your credit score that you can access is not the same one seen by potential creditors. And, your score can vary depending on which credit scoring agency is used. According to a report from the Consumer Financial Protection Bureau, one in five people are getting credit score reports that are significantly different from what retailers see. This can cause many consumers to pay a higher interest rate than they should because they fail to shop for a better deal on credit card interest rates. In other cases, consumers inadvertently lower their own scores by applying for loans that are beyond what they can qualify for.

In the end, the best thing you can do is arm yourself with knowledge. As you work toward home purchase plans, stick with accepted best practices for credit health. By keeping your eye on your financial health, you can find your way through this complex and sometimes unfair system.

Click here to request a free consultation from one of our certified credit experts.

Free Annual Credit Report – How to get them.

Regularly checking your credit report is imperative to assuring your financial health. You will need to know your credit scores to know what sorts of mortgages you can realistically qualify for when you embark on home purchase plans. And, finding out what is wrong and fixing it is a vital part of the credit repair process.

Credit reports and credit scores used to be hard to find. You never knew what your score was or what information determined it. The Fair and Accurate Credit Transactions Act of 2003 increased transparency by requiring the three major credit reporting agencies to provide consumers with free access to their credit reports once a year.

To get your free annual credit reports, follow these steps:

  1. Visit the site While there are other sites that offer credit reports, this is the only official clearinghouse to get yours from all three credit bureaus for free.
  2. Provide the requested information. You will start by entering your state of residence, then identifying information such as your name, current address, previous address and Social Security Number.
  3. Once the site finds your information in the system, you will be prompted to provide some identifying information about your credit history. For instance, you will be asked which bank holds your car loan, and will have to select the answer from four options below. Do not feel alarmed if you are asked about accounts that you do not have. “None of the above” is one of the acceptable answers!
  4. Once your identity is confirmed, you will have the chance to visit each of the credit bureaus in turn. In between looking at your reports, you will return to Follow directions closely to avoid risk of inadvertently closing out your session.
  5. When you visit the sites to view your credit report, you will find that the information is organized a little differently on each. But, they will all contain information about your current loans, credit cards, past debts, and credit inquiries. Negative items such as bankruptcies and liens will appear in their own section.
  6. Study the information in the report carefully. Are there any errors? Are any of your credit accounts missing from the report? These can artificially lower your score, and you should dispute these items. A federal study in 2004 found that 79% of all credit reports contain at least one error.
  7. Be sure to print a copy of each report or to save it to your computer. You can save a copy by choosing “print” and then picking “Adobe PDF” as the printer. This way, you are able to consult the report repeatedly as you address any issues.

You are allowed to check your report free once per year. To remind yourself that it’s time to check your free credit report, try to link the date to an outside reminder. For instance, many people check their credit reports on the same day that they turn the clocks back each fall. By checking each year, you can keep yourself up to date on what your credit reports say and keep yourself aware of your own financial health.

FICO & Vantage Scores – Different Systems

Different Systems, Different Scores

Those three little digits that control so many of your financial opportunities. Your credit score can be pulled when you apply for a job, shop for insurance, during the home purchase process and in many other circumstances. But, it might surprise you to learn that there are actually a number of different agencies that create credit scores, and your scores will vary depending on which one is used. Some financial institutions even have their own internal credit scores that they use in place of independent ones.

Some of the most common credit scores used to determine your credit worthiness:


The FICO score is the one that people are most familiar with. It uses information from the three major credit bureaus to assign a three digit score that estimates credit risk. The score uses a number of weighted factors that include payment history, age of the accounts, ratio of available credit to debt, types of credit used and how recently you’ve searched for new credit. Your FICO score might vary depending on which credit bureau’s records are pulled to estimate your score.

Vantage Score

This credit score was created through a joint effort between Experian, Equifax and TransUnion. The advantage of the VantageScore is that your score is the the same no matter which credit bureau’s information is pulled to calculate it. The score can range from 501 to 990 and also comes with a letter grade. It has not been adopted by many creditors and is currently only used for about 6% of credit score pulls.

PLUS Score

This score was created by Experian to give consumers an easy to understand their credit health. It is not used by lenders; instead, it is intended as a consumer tool. The scoring range goes between 330 and 830, with a higher score indicating lower credit risk. Since this is not the score that creditors use when considering credit-worthiness, do not be surprised if your PLUS Score is different from the score that your bank says that you have.

TransUnion New Account Credit Score

This credit score is available for free from financial monitoring site Credit Karma. (As an aside: Credit Karma is a great resource for those undergoing credit repair. They allow you to check your credit score in real time and also to test what affect different actions will have using their credit score simulator.) The TransUnion New Account score is used by many lenders to decide how risky it is to extend credit to you. This score ranges from 300 to 850. It is based on information from TransUnion. It is made up of a number of factors that include the age of your accounts, our payment history and other factors.

Auto and Home Insurance Scores

These scores are used by the insurance industry to determine risk of a claim if you are insured by them. The results can affect the rates that you are extended when you shop for a policy. The scores range from 150 to 950. While the use credit scores for insurance is controversial, industry members defend the policy because of a correlation between credit scores and insurance risk.

Who We Are – Welcome to Key Credit Repair

Who We Are: Bad credit is not a permanent situation. With the help of our certified consultants we will show you the proper steps needed to improve your scores, remove in-accuracies and reduce your debt load.

At Key Credit, we offer professional services custom tailored to your specific situation. Call our credit consultants today for your free, no-obligation consultation. The consultation is completely FREE of charge. If you don’t have a credit report we can order one for you.

Click here to request a free credit repair consultation today.

Fico vs. Fako – Credit Tips

“What is my real credit score? Really!”

10.24.2014 Key Credit Repair

This is a very common subject we cover and one of the most confusing thing in the credit industry. What are my real scores? How are they really calculated? Well, let me tell you. It’s more complicated then you might think. With the introduction of the Vantage score by transunion and the credit plus score by experian it just become a little bit more complicated.

Client: “I pulled my credit report online and the score my loan officer pulled up was completely different?”

Yes, there are multiple credit scoring formulas. The industry standard remains FICO but consumers are no longer given access to all 3 FICO scores (experian, equifax & transunion).

Click to read an article recently posted on msnbc

Remember, if you are in the market for a mortgage or any other loan product you can always review the details of your report by going to but remember, only your lender can access all 3 fico scores. Start the process early so if you find that your FICO scores are too low you can quickly work on getting things up to par. It is truly never too early. The process of purchasing a home could take months and in some cases years. It is much better to be prepared early then trying to scramble to fix your credit after you’ve found a home.

Understanding FICO Scores For a Mortgage

Obtain a mortgage loan and you’ll soon come to be familiar with FICO scores. Below you will find a guide on the infamous FICO racking up procedure. This  is the primary scoring formula used by fannie and freddie mac, the goverment agencies that insure and underwrite 80% of the mortgages in the United States.

FICO ratings are simply an algebraic portrayal of your credit document. Credit rating documents are just a recording of your possessions and financial obligations. Credit card equilibriums, for example, are a financial obligation that shows up on your credit history record, as do late repayments, bounced checks and more. Credit, obviously, is a substantial consideration in the mortgage loan process.

A “credit score” is a figure that stands for an overall evaluation of exactly how you handle credit rating and also the danger degree associated with offering you a lot more credit rating, to wit, a home loan. The funding underwriter will evaluate your credit rating guide for products such as settlement record on financial obligations, financial obligation balances and also sorts of credit rating you currently have. A summary of this information is stood for by an amount called you “FICO score.”.


You may be shocked to discover that “FICO” does not mean any credit-related terms. Rather, it represents Exhibition, Isaac and Company. This company produced the algebraic formula that creates the much loved or disliked FICO credit scores. The FICO rating assigned to you determines whether you love or hate the formula.

FICO credit scores been available in a variety of three figure numbers. The most affordable FICO credit score you can get is 350. The highest FICO score is 850, a score for which lenders will bow at your feet. The higher your score, the much better your credit situation and the most likely a banking is to supply you with a mortgage loan.

Lots of people do not have excellent credit. To this end, we discover lots of people have FICO scores varying from the low 600s to the high 700s. Mortgage applications typically are not turned down due to a couple of late repayments.

You should always attempt to pre-qualify for a mortgage financing if you’re considering purchasing a residence. Getting a reading of your FICO credit score should be among the initial steps.

FICO credit scores are merely an algebraic portrayal of your credit rating record. The FICO score designated to you establishes whether you despise the formula or enjoy.

The greatest FICO credit score is 850, a score for which bankers will bow at your feet. To this end, we find many individuals have FICO scores ranging from the low 600s to the high 700s.

For more information and a breakdown of how FICO scores work and how they can affect your mortgage approval you can contact our office at 877-842-5215 (toll free) or fill out the form below to request a consultation at a later time.

Nikitas Tsoukalis, President

Key Credit Repair

877-842-5215 Toll Free

Credit Repair Company