Credit Scores : Your Oceanside Mortgage Loan Professional : 516 536-2525

A Score that Really Matters: Your Credit Score

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Before lenders decide to give you a loan, they need to know if you are willing and able to repay that mortgage loan. To figure out your ability to pay back the loan, lenders assess your debt-to-income ratio. To assess how willing you are to repay, they use your credit score.

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

Credit scores only consider the information in your credit reports. They don't consider income or personal characteristics. Fair Isaac invented FICO specifically to exclude demographic factors like these. Credit scoring was developed as a way to take into account solely what was relevant to a borrower's willingness to repay a loan.

Your current debt load, past late payments, length of your credit history, and other factors are considered. Your score considers both positive and negative information in your credit report. Late payments lower your score, but consistently making future payments on time will raise your score.

For the agencies to calculate a credit score, you must have an active credit account with six months of payment history. This history ensures that there is sufficient information in your credit to assign a score. Should you not meet the criteria for getting a score, you may need to establish your credit history prior to applying for a mortgage loan.

G & M Wolkenberg Inc. can answer your questions about credit reporting. Call us at 516 536-2525.