About Your Credit Score

Before lenders make the decision to lend you money, they want to know if you're willing and able to repay that mortgage. To assess your ability to repay, they look at your income and debt ratio. In order to assess your willingness to repay the mortgage loan, they consult your credit score.

Fair Isaac and Company developed the first FICO score to assess creditworthines. You can learn more about FICO here.

Your credit score comes from your repayment history. They don't consider your income, savings, amount of down payment, or personal factors like gender, ethnicity, nationality or marital status. Fair Isaac invented FICO specifically to exclude demographic factors like these. Credit scoring was developed as a way to consider solely that which was relevant to a borrower's willingness to pay back the lender.

Deliquencies, payment behavior, current debt level, length of credit history, types of credit and the number of inquiries are all considered in credit scoring. Your score results from positive and negative items in your credit report. Late payments lower your credit score, but establishing or reestablishing a good track record of making payments on time will raise your score.

Your 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 report to calculate a score. Some folks don't have a long enough credit history to get a credit score. They may need to spend a little time building credit history before they apply.

The Rate Kings Mortgage LLC can answer your questions about credit reporting. Give us a call: 6105723635.