Welcome to Home Mortgage
New Home Mortgage Article
. For a permanent link to this article, or to bookmark it for further reading, click here.
You may also listen to this article by using the following controls.
Fair Isaac Corporation Credit Or FICO Score
from: Roy ThomsittAs I am not from the US, I had no idea what FICO meant before researching it. FICO stands for Fair Isaac Corporation, a company based in California. FICO, put simply, is a person's credit score. A credit score can be used by a potential lender in making a judgement on whether to grant you credit or not, for example when you apply for a new credit card or home mortgage. Therefore, if you are in the US, the FICO score is very important to you. What Does a FICO Score Do?
A FICO score places a value on the types of credit accounts you hold or have held, and your credit history in maintaining those accounts. The FICO score scale ranges from 300 to 850, with the majority of people in the United States in the 600 - 850 range.
Factors Which Affect Your FICO Credit Score
There are 5 factors in all which determine your FICO credit score:
1. Your payment history.
This counts for a very significant 35%--the most of the FICO score factors. As you would expect, paying your bills on time is gets you a good score, while paying them late on a consistent basis is will mark down your FICO score. If you have had debts referred to a collection agency, that is worse still, while declaring bankruptcy is the worst of all.
2. How much you owe.
Another obvious factor that FICO will take into account in arriving at a credit score. This accounts for another 30% of your total FICO score. It is not just what you owe already that affects your FICO score. Also taken into account is the amount of credit available to you. For example, if you have a credit line of $5000, but have so far only used $1000, that will be taken into account.
Your total amount of credit will be totalled, and compared to your annual income. So, loans such as car loans, mortgages, credit cards, store cards, will all be added together. Those who use most or all of their available credit will get a lower rating for this part of the FICO score calculation.
3. Length of credit history.
Another important factor that makes up 15% of your FICO credit score is the length of your credit history. The longer your credit history, the better for your FICO score. Additionally, though, a long history with any particular lender will be good for your credit score.
4. Type of credit mix.
The fourth factor taken into consideration is the type of credit mix that you have. For example, do you have only high risk unsecured type credit, or do you also have some solid secured loans such as a home mortgags? Those consumers who have a mix of credit have higher a FICO score. This fourth factor just counts for 10% of the total FICO score.
5. Number of new credit applications.
The last factor in the FICO rating is the amount of new applications that you fill out. If you have recently filled out a lot of credit applications, this will hurt your score because it puts lenders “on alert” that something may be wrong. This part of the score is worth 10%.
Lenders themselves will normally look at employment, income, length at current residence, and marital status, but these do not affect your FICO score. If you intend to borrow in the future, you do need to pay attention to your FICO score. If your FICO score is low, this could lead to higher interest rates, extra mortgage insurance when buying a home, and in some cases denial of the loan.
If you plan to take out a major loan, such as a home mortgage, it could be a wise move to get a copy of your credit report 6 months before you plan to apply. That will give you time to look over your history, to ensure there are no discrepancies. If you find inaccuracies, contact the Credit Reporting Agency in writing. They will have 30 days to investigate it, and then correct it if they find your claims are true. You may also want to ask for a revised credit report; they are required by law to supply you with one if an inaccuracy is found and corrected.
About the Author
Roy Thomsitt is the owner and part author of http://www.eliminate-credit-card-debt-now.com
New Home Mortgage News
Minnesota Bank & Trust Announces New Mortgage Group
Minnesota Bank & Trust announces a new mortgage group that will provide a full suite of standard and niche residential mortgage products and services. Minnesota Bank & Trust Mortgage is led by a team of expert mortgage lenders with over 100 years’ combined experience in the mortgage industry.
Read more...Ryan Homes Announces the New Griffin Model Home at Legacy at Manning Village in Accokeek, Maryland
ACCOKEEK, Md., Feb. 9, 2012 /PRNewswire/ -- NVR, Inc. (NYSE: NVR - News), one of the nation's largest homebuilding and mortgage banking companies, announces the grand opening of the new Griffin model home at ...
Read more...Home loans may get cheaper with new mortgage guarantee company
Home loans may soon come at better terms, with the concept of mortgage guarantee set to take off in the coming weeks.
Read more...New York, California to sign mortgage settlement
California and New York have agreed to join a federal-state settlement involving alleged deceptive practices by five leading mortgage servicing companies that could reach $25 billion.New York and California were two of the most prominent holdouts from the settlement, which could be announced as soon as Thursday and has been under discussion for almost a year. As of Monday, more than 40 states ...
Read more...Security America Mortgage, Inc. Proudly Announced New Sponsorship of Three (3) Brand New VA Home Loan Websites for ...
Security America Mortgage, Inc. Proudly Announced New Sponsorship of Three (3) Brand New VA Home Loan Websites for Military Buying a Home in cities located within Texas, Florida, and Colorado! (PRWeb February 08, 2012) Read the full story at http://www.prweb.com/releases/2012/2/prweb8893321.htm
Read more...Growth in Canadian new home prices slows in December
OTTAWA (Reuters) - The pace of growth in new home prices in Canada slowed in December to 0.1 percent compared with 0.3 percent in November, Statistics Canada said on Thursday, in another sign the hot housing market may be cooling. Markets had expected a 0.2 percent price gain in the month, according to the median forecast in a Reuters survey. Compared with a year earlier, the new housing price ...
Read more...Mortgage Rates New Record Low Attracts Attention From Consumers According To BurlingtonMortgage.biz
Mortgage Rates New Record Low Attracts Attention From Consumers According To BurlingtonMortgage.biz Home mortgage rates have set yet another record, dropping to new lows for 30 year fixed, 15 year fixed, and 5 year ARM home loans, according to mortgage rate research website, BurlingtonMortgage.biz. "Around the holidays refinancing or buying a home just isn't on most people's radars" explains Nat ...
Read more...