Credit Scores

Before lenders make the decision to give you a loan, they must know if you're willing and able to repay that mortgage loan. To understand your ability to repay, they assess your income and debt ratio. To assess your willingness to repay, they use your credit score.

Fair Isaac and Company built the original FICO score to assess creditworthines. For details on FICO, read more here.

Credit scores only assess the info contained in your credit profile. They don't consider income or personal characteristics. These scores were invented specifically for this reason. "Profiling" was as bad a word when these scores were invented as it is now. Credit scoring was developed to assess willingness to pay without considering any other demographic factors.

Your current debt load, past late payments, length of your credit history, and other factors are considered. Your score is calculated wtih both positive and negative information in your credit report. Late payments count against you, but a record of paying on time will improve it.

Your credit report must have 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 payment history ensures that there is sufficient information in your credit to assign a score. Some people don't have a long enough credit history to get a credit score. They may need to spend a little time building a credit history before they apply.

Metro Mortgage can answer questions about credit reports and many others. Give us a call at 866-300-1550.