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| photocredit: myfico.com |
When applying for a
home mortgage loan, you may hear the term FICO score thrown out in
conversation. FICO stands for Fair Isaac Corporation, one of the leading data
analytics companies in the country specializing in credit scores. Your FICO
score, or your credit score, will determine whether you can be approved for a
loan and the size of the loan for which you can be approved. It’s an essential
part to finding your new home, so today, here’s your guide to everything you
need to know about FICO scores.
How Does It Work?
Credit reporting
agencies like Equifax, Experian, and TransUnion send your information to FICO,
who analyzes every aspect of your credit history to create a score. Credit
scores typically range between 300 and 850. 650 is considered a common score
and will afford you a decent loan. 750 is considered an excellent score. In
order to get a FICO score, you must have one bank or credit account that has
been open for at least 6 months.
How
Can You Boost Your FICO Score?
If you have time,
and you think your credit score now might be less than flattering, there are a
few things you can do to improve it before you apply for your home mortgage
loan. Get into the habit of making timely payments on your bills, whether
utility bills or the charge for your credit card. If you can invest in a retail
credit card for a local store near you, the timely payments made on that card
can help to boost your score. Remember that this score is ultimately to
indicate to the lending company whether you’ll be able to make timely payments
on your home mortgage, so it’s important to set a good example now.
You should also
make sure that all of your cards and accounts are active. Each account handling
a little bit of debt will look better than one or two active accounts and three
that haven’t been used in months.
How Do You Get (or Check) Your FICO Score?
When you
pre-qualify for your mortgage, the bank will run your credit information to get
a FICO score regardless of whether you know it or not. However, there are some
ways to check your FICO score beforehand, so you can know what to expect. You
can check myFICO.com
or Annual
Credit Report for free to find more information about your credit. Equifax,
Experian,
and TransUnion
all charge a small fee but will also provide you with a credit score similar to
FICO’s credit score.
That’s why it
matters to have a local real estate professional to help you in every
aspect of your search for your new Bryan-College Station home. An expert real
estate agent can answer your questions and ease your concerns about your FICO
score or any other aspect of the pre-qualification process, because she’s been
through this process so many times. She’ll be happy to help in any way she can.
Home for Sale in College Station
Sarah Miller, your RE/MAX realtor bryan-college station can help you discover a lot of great tips for making a profitable sale of your home. Call Sarah Miller at 979-255-1904 for your real estate needs in Bryan-College Station and the entire Brazos Valley!
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