About Your Credit Score

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Before lenders make the decision to lend you money, they have to know that you are willing and able to pay back that mortgage. To assess whether you can pay back the loan, they look at your income and debt ratio. To assess how willing you are to repay, they use your credit score.

Fair Isaac and Company built the first FICO score to help lenders assess creditworthiness. You can learn more about FICO here.

Credit scores only assess the info contained in your credit reports. They don't take into account your income, savings, amount of down payment, or demographic factors like sex race, national origin or marital status. These scores were invented specifically for this reason. Credit scoring was envisioned as a way to assess willingness to repay the loan without considering other demographic factors.

Your current debt load, past late payments, length of your credit history, and a few other factors are considered. Your score is calculated with positive and negative information in your credit report. Late payments will lower your credit score, but consistently making future payments on time will improve your score.

Your credit report must 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 generate a score. Some folks don't have a long enough credit history to get a credit score. They should spend some time building up a credit history before they apply.

Main Line National Mtg Inc can answer your questions about credit reporting. Give us a call at (610) 296-3600.