Basic Credit Scoring 101 For A Better Mortgage Rate
Mortgage pricing is now paying more attention to credit scoring. Since credit scores are now more important , it is vital that you locate and review your credit score. If you learn how the credit scoring system operates, you can make it work for you. The web site my FICO.com is a great place to start.
Equifax is one of the primary credit bureaus and is the publisher of my FICO.com. This site provides a wealth of suggestions, tricks and tips that will help you figure out the credit scoring system.
Here are some basic pointers to get you started:
Remember the number 30: Credit card balances should hold steady at no more than 30% of the card limit. The credit bureau believes that you are responsible with use of credit if this is your situation. If you consider consolidating several credit card balances into a single card, be careful of the single card limit because overloading could hurt your score.
You Have A Friend In The Trend: The credit bureaus smile on “on time” payments. If you have a record of paying on time, you are likely to continue the pattern . If you’re late, catch up right away. This is the biggest portion of your credit score at 35 percent.
The Trend Is Your Friend: A track record of paying accounts on-time means that you’re likely to continue paying on-time. Credit bureaus like on-time payments. If you’ve been late, catch up immediately. At 35 percent, this is the largest component of your credit score.
Pay Attention To History: Maintain a credit “history.” Don’t close out credit cards that you don’t use. That history will be 10% of your score.
Start to identify the probable issues in your credit history and improve them. More helpful ideas are available at my FICO.com. Later this year, more credit score adjustments to mortgage rates are expected. So, protect yourself with proactive measures.
We all want the best mortgage rate possible, but are not always clear about the best way to get credit scoring formation . Please speak with your loan officer about getting the personal information that you need.
