When you apply for a mortgage loan, you expect your lender to pull a credit report and look at whether you’ve made your payments on time. What you may not expect is that they seem to be more interested in your FICO® score.
“What’s a FICO® score?” is a common reaction.
Each time your credit report is pulled, it is run through a computer program with a built-in scorecard. Points are awarded or deducted based on certain items such as how long you have had credit cards, whether you make your payments on time, if your credit balances are near maximum, and assorted other variables. When the credit report prints in your lender’s office, the total score is displayed. Your score can be anywhere between the high 300’s and the low 850’s.
Lenders wanted to determine if there was any relationship between these credit scores and whether borrowers made their payments on time, so they did a study. The study showed that borrowers with scores above 680 almost always made their payments on time. Borrowers with scores below 600 seemed fairly certain to develop problems.
As a result, credit scoring became a more important factor in approving mortgage loans. Credit scores also made it easier to develop artificial intelligence computer programs that could make a “yes” decision for loans that should obviously be approved. Nowadays, a computer and not a person may have actually approved your mortgage.
In short, lower credit scores require a more thorough review than higher scores. Often, mortgage lenders will not even consider a score below 600.
Some of the things that affect your FICO score are:
FICO® actually stands for Fair Isaac and Company, which is the company used by the Experian (formerly TRW) credit bureau to calculate credit scores. Trans-Union and Equifax are two other credit bureaus who also provide credit scores.Back to Table of Contents
and our Morro Bay Affiliate & second location
San Luis Obispo Realty
441 Marsh Street
San Luis Obispo, CA 93401
CA BRE# 00577121
Dont Miss a New Listing Again!
Already registered? Login
FREE AUTOMATED EMAIL UPDATES
Sign in to take advantage of all this site has to offer. Save your favorite listings and searches – also receive email updates when listings you like come on the market for free!
*Contact Information NOT Shared*
Home | Office Listings | Open Houses | Search for Homes | Advanced Search | Map Search | Newly Listed in the San Luis Obispo Area | San Luis Obispo | Arroyo Grande | Atascadero | Morro Bay | Nipomo | Paso Robles | Avila Beach | Commercial Search | Foreclosures, REO, Bank owned, Short Sales | San Luis Obispo Lots and Land | Commercial Real Estate - City | Trilogy, Monarch Dunes Golf Resort Homes in Nipomo | Cypress Ridge Golf Course Homes - Arroyo Grande | Foreclosure Search | Avila Beach Mobile Homes | San Luis Obispo Country Club Estates - Homes For Sale | Pelican Point Avila Beach | The Villas - Avila Beach | Bassi Ranch - Avila Beach Homes for sale | Mortgage Rates | Buyer/Seller Info | Our Blog | Real Estate News!!! | Local Resources | Weather | Relocation | San Luis Obispo, the Happiest Place to Live! | Real Estate Terms | School Information | Contact Us | San Luis Obispo Housing, Homes for sale in San Luis Obispo | Real Estate in San Luis Obispo, CA, agent, broker | real estate in San Luis Obispo, Country Club Estates, Luxury | Pismo Beach and San Luis Obispo, CA homes for sale | Office Listings -... | King Fisher - Avila Beach | Pismo Beach Homes only | Pismo Beach Mobile Homes | Pismo Beach - Condos | Pismo Beach - Ocean View Homes | Indian Hill Mobil... | A Bit More About Us | | Commercial County Search | Our Agents | Gated Communities | SLO County Vineyards and Wineries | SLO Community Sea... | Ocean View Homes | San Luis Obispo Golf Courses and Homes for sale | Community Searches
Based on information from California Regional Multiple Listing Service, Inc. as of 2019-05-25. This information is for your personal, non-commercial use and may not be used for any purpose other than to identify prospective properties you may be interested in purchasing. Display of MLS data is usually deemed reliable but is NOT guaranteed accurate by the MLS. Buyers are responsible for verifying the accuracy of all information and should investigate the data themselves or retain appropriate professionals. Information from sources other than the Listing Agent may have been included in the MLS data. Unless otherwise specified in writing, Broker/Agent has not and will not verify any information obtained from other sources. The Broker/Agent providing the information contained herein may or may not have been the Listing and/or Selling Agent.