The Consumer Credit Protection Act and the FICO Score

A variety of considerations of financial history and information is used to calculate a consumer’s credit in the mortgage loan application process. Aside from annual income, length of employment with current employer, and payment history certain personal criteria may not be utilized in the credit report or FICO scoring:

• Gender

• Sexual orientation

• National origin

• Religious affiliation or denomination

In the United States, legislations deem it a violation of the Consumer Credit Protection Act if any of the above considerations are employed in a credit report or in making a mortgage loan application approval. American consumers are protected and allowed to exercise any of the consumer rights defined in the Consumer Credit Protection Act.

Moreover, FICO credit scores utilized specific guideline in formulizing credit ratings. For instance, a FICO score do not utilize the following data in calculating credit: sex or gender, nationality, religious beliefs or sexual orientation. Additionally, while other types of credit scoring may employ any of the following criteria to calculate scores, FICO scores do not:

• Employment occupation

• Employment title

• Employment salary

• Employment commencement date

• Employment history

• Neighborhood of residency

As credit scores and FICO scores grade a consumer based on the number of credit inquiries, ratings cannot account for any "consumer-initiated" inquiries (credit requests made by the consumer regarding their credit report). Essentially, credit scores cannot count ‘promotional inquiries.’ A promotional inquiry is considered requests that are may by credit card companies or financing companies offering ‘pre-approved’ loan or credit offers. Additionally, ‘administrative inquiries,’ any queries administered by lenders to assess an account ore demarcated as originating via an employer are not counted either.