Credit Scores

Before lenders decide to lend you money, they have to know that you are willing and able to repay that loan. To understand your ability to pay back the loan, they look at your income and debt ratio. To assess your willingness to repay, they use your credit score.

Fair Isaac and Company developed the original FICO score to help lenders assess creditworthines. You can learn more on FICO here.

Your credit score is a direct result of your repayment history. They never take into account income, savings, down payment amount, or factors like gender, race, national origin or marital status. These scores were invented specifically for this reason. Credit scoring was envisioned as a way to take into account solely what was relevant to a borrower's willingness to repay the lender.

Your current debt load, past late payments, length of your credit history, and a few other factors are considered. Your score is calculated from both the good and the bad of your credit history. Late payments count against you, but a record of paying on time will improve it.

Your credit report should contain at least one account which has been open for six months or more, and at least one account that has been updated in the past six months for you to get a credit score. This history ensures that there is sufficient information in your credit to calculate a score. Some people don't have a long enough credit history to get a credit score. They may need to spend some time building up credit history before they apply.

At 1st Credential Mortgage Inc, we answer questions about Credit reports every day. Call us: (281) 778-0805.

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