About Your Credit Score

Before deciding on what terms they will offer you a loan, lenders must find out two things about you: whether you can repay the loan, and how committed you are to pay back the loan. To assess whether you can repay, they assess your income and debt ratio. To calculate your willingness to repay the mortgage loan, they look at your credit score.

Fair Isaac and Company developed the original FICO score to assess creditworthines. For details on FICO, read more here.

Your credit score comes from your repayment history. They do not consider your income, savings, down payment amount, or demographic factors like gender, ethnicity, national origin or marital status. These scores were invented specifically for this reason. Credit scoring was invented as a way to take into account only what was relevant to a borrower's likelihood to repay the lender.

Past delinquencies, derogatory payment behavior, debt level, length of credit history, types of credit and the number of credit inquiries are all considered in credit scores. Your score is calculated wtih positive and negative information in your credit report. Late payments will lower your score, but consistently making future payments on time will improve your score.

To get a credit score, borrowers must have an active credit account with at least six months of payment history. This history ensures that there is enough information in your credit to build an accurate score. If you don't meet the minimum criteria for getting a credit score, you might need to establish a credit history before you apply for a mortgage.

1st Credential Mortgage Inc can answer questions about credit reports and many others. Give us a call: (281) 778-0805.

Got a Question?

Do you have a question? We can help. Simply fill out the form below and we'll contact you with the answer, with no obligation to you. We guarantee your privacy.

Your Information
Your Question