Credit Scores

Before lenders make the decision to give you a loan, they must know that you're willing and able to repay that loan. To figure out your ability to repay, lenders look at your debt-to-income ratio. To assess your willingness to pay back the mortgage loan, they consult your credit score.

The most commonly used credit scores are called FICO scores, which were developed by Fair Isaac & Company, Inc. Your FICO score ranges from 350 (high risk) to 850 (low risk). We've written more about FICO here.

Credit scores only assess the info in your credit profile. They don't consider income or personal characteristics. These scores were invented specifically for this reason. Credit scoring was developed to assess a borrower's willingness to pay while specifically excluding any other irrelevant factors.

Deliquencies, derogatory payment behavior, current debt level, length of credit history, types of credit and the number of inquiries are all considered in credit scoring. Your score is based on the good and the bad of your credit history. Late payments lower your score, but establishing or reestablishing a good track record of making payments on time will improve your score.

To get a credit score, you must have an active credit account with six months of payment history. This payment history ensures that there is enough information in your report to build an accurate score. If you don't meet the criteria for getting a score, you may need to work on your credit history before you apply for a mortgage loan.

Queen City Mortgage Company, LLC can answer your questions about credit reporting. Give us a call at 5137966020.

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Queen City Mortgage Company, LLC

NMLS#: 276004

8150 Corporate Park Dr, Ste 200
Cincinnati, OH 45242