Your FICO score
Credit
How your credit score affects your mortgage.
Your score affects whether you qualify, which programs are open to you and the rate you’re offered. Here’s how lenders read it, and what actually moves it.
How lenders read it
Three bureaus, the middle score.
FICO scores run from 300 to 850. Mortgage lenders usually pull reports from all three bureaus (Equifax, Experian and TransUnion) and use the middle of your three scores. With two borrowers, many programs use the lower of the two middle scores.
Minimum scores vary by program and lender, and higher scores generally get better pricing, so it’s worth knowing where you stand before you apply.
What goes into it
The five factors FICO weighs.
Weights as published by FICO for the general population.
Payment history, 35%
On-time payments matter most. A recent late payment hurts more than an old one.
Amounts owed, 30%
Especially how much of your card limits you’re using. Lower is better.
Length of history, 15%
The age of your oldest and average accounts.
New credit, 10%
Recent applications and newly opened accounts.
Credit mix, 10%
A mix of cards and installment loans.
Before and during your loan
What helps, and what to avoid.
- Check your reports free from all three bureaus at AnnualCreditReport.com, and dispute anything wrong.
- Pay down card balances before the lender pulls credit. Lower utilization is the fastest legitimate improvement.
- Don’t open new credit or finance furniture or a car between application and closing. Lenders re-check before closing.
- Don’t close old cards just before applying; it can raise your utilization and shorten your history.
- Keep paying everything on time, including accounts you’re disputing.
Want to know where your credit puts you?
We’ll review it as part of your pre-qualification. Or call 305-933-1626 to talk it through.