About Your Credit Score

Before lenders decide to lend you money, they must know if you are willing and able to pay back that mortgage. To assess your ability to pay back the loan, lenders look at your debt-to-income ratio. To assess your willingness to repay, they use your credit score.

Fair Isaac and Company developed the original FICO score to help lenders assess creditworthines. You can find out more about FICO here.

Your credit score comes from your history of repayment. They don't consider your income, savings, down payment amount, or personal factors like sex race, nationality or marital status. Fair Isaac invented FICO specifically to exclude demographic factors. Credit scoring was envisioned as a way to consider only what was relevant to a borrower's likelihood to repay a loan.

Deliquencies, payment behavior, current debt level, length of credit history, types of credit and number of credit inquiries are all considered in credit scores. Your score results from both positive and negative items in your credit report. Late payments count against your score, but a consistent record of paying on time will raise it.

To get a credit score, you must have an active credit account with a payment history of six months. This history ensures that there is sufficient information in your credit to build a score. If you don't meet the criteria for getting a credit score, you might need to establish your credit history prior to applying for a mortgage loan.

At Foxfield Financial, we answer questions about Credit reports every day. Give us a call at 720-598-8300.

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