Dec 212010
 

If you are planning on buying a home soon, or even a year or two from now, here are some good things to know about qualifying for a loan. This information comes from a certified trainer for “FICO Scoring 101”.

The FICO score is based on five different weighted factors:

▪ Payment History: The record of your on time and late payments
▪ Amounts Owed: Your credit limit minus the amount you owe for each account
▪ Length of History: The average length of time of all open accounts
▪ New Credit: Records of inquiries, new account openings
▪ Type of Credit: Mortgages, installment loans, revolving accounts etc

Easy Ways To Improve Your Credit Score:

With all the different kinds of information that credit scoring models incorporate, numerous tactics for improving scores are available. However, any action to improve a score must be taken judiciously: some actions aimed at improving your score may actually make it worse. Precision Credit Group can help you determine which steps will help your credit the most, without doing harm.

Many individuals reap significant benefits by properly employing these simple FICO score improvement techniques:

▪ Make payments on time, especially to installment and revolving accounts, as these report to the bureaus monthly
▪ Do not apply for any new credit cards or loans
▪ Pay credit card balances down to 30% of your credit limit or less
▪ Make sure your credit card company reports a limit
▪ Keep 3-5 open and active accounts in good standing on your credit report
▪ Review your credit report every year

This information provided by Ryan D. Keip, Owner of Precision Credit Group

The Derrick Team is not associated with Precision Credit Group but is providing these tips to help you get ready to buy your home. This information is not provided as professional advice. Consult with your lender if you have any questions on your FICO score and what you need to do to qualify for a loan as not all lenders follow the same guidelines.

When you’re ready to buy a house, give us a call. Being represented by a Realtor costs you nothing!

 

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