How's Your Score?Choosing a lender isn't the first step in becoming a homeowner. In reality, the home buying process begins with your finances. To propel your dreams of homeownership forward, you must consider your FICO score along with the type of mortgage loan for which you'll qualify in Sevierville, Tennessee.
The Fair Isaac Company calculates your FICO score on the summary of your complete credit history. Most people usually have a score of 600, but scores range from 300 to 850. Since we've experienced an economic downturn, however, some people have seen their score drop by hundreds of points as a result of loss of employment, delinquent credit card accounts, or credit card accounts that were closed because they don't carry a balance. Some of the pieces in calculating your FICO score are:
- Credit to Debt Ratio — How much do you owe versus your available credit?
- Credit Inquiries — Do you have too many open accounts?
- Types of Credit — Do you have a healthy mix of credit cards and loans?
- Payment History — How many late payments have you made?
In reviewing your credit history, you'll see that you actually have three reports. Experian, Equifax and TransUnion — three of the major credit reporting agencies — use a slightly different models to calculate your credit rating. FICO is used by Experian. Equifax's model is called BEACON and TransUnion uses EMPIRICA. You have a credit score with all three of the bureaus.
When you apply for a mortgage or any other loan, lenders want to make sure that extending a loan to you isn't a risk. Your credit score gives lenders view of what type of borrower you'll be based solely on your credit history. You'll need a score of at least 700 to get a satisfactory interest rate. You can qualify for a mortgage loan with a lower score, but the interest accumulated over the life of the loan could be more than double the amount of an individual with a stronger FICO score.
|Staying on top of your FICO score is the first step in purchasing a home. Call us at 865.429.2121 and we can help you get on the right track to the home of your dreams.|
How do you boost your credit score? Building your FICO score takes time. At Century 21 MVP, we know it's hard to make a significant change in your number with small changes, but your score can improve in a year by monitoring your credit report and by using credit extended to you to raise your score, instead of ruin it. The best way to do this is to know your FICO score. You'll improve your credit score by using these tips:
Now that you know more about credit reporting, you'll be able to successfully take the first step in owning a home, and that is improving your FICO score. Know that when it's time to apply for a loan to purchase a home, you'll want to keep your credit inquiries within a two-week window to avoid adverse effects your credit score. With the help of Century 21 MVP, the loan application process is sure to go more smoothly so you, too, can become a homeowner.
Learning more about your actual FICO scoresYou can learn more about your FICO scores at various website- some charge for services, but others do not.
Learn more about FICO scores at www.myFICO.com, Fair Isaac's informational site and you can review all of your credit reports for free each year at www.annualcreditreport.com. And, for a small payment, you can get your FICO score from each bureau on their websites: www.equifax.com, www.experian.com and www.transunion.com.
May charge for services
At Credit Karma website, you can get your credit score at any time free of charge.
Services not charging for credit information
Contact WalletHub for free credit score at any time free of charge.
These free sites also have information on your credit and how to improve your score. In addition, there is information on credit cards that allow you to compare offerings of various companies.
Contact Century 21 MVP for help!
At CENTURY 21 MVP we don't judge you based on your credit history and can help you step into home ownership with the best mortgage lender for you. E-mail us at firstname.lastname@example.org or call 865.429.2121 for more information.