Credit Report Score Info
Your credit score is one of the core, key pillars upon which obtaining your home mortgage loan is founded upon. Your credit report is a detailed treatise of your credit history with other financial organizations and institutions. It outlines your payment history, your late payments, your tradelines (a tradeline is an open financial account such as a credit card account or a home equity loan), it even lists your aliases, if any, usually at the back of the report.
It lists foreclosures, bankruptcies, loan defaults, collection account activity, as well as good payment history. (Of course you can still get a bad credit mortgage loan notwithstanding your poor credit score.) General information is also on it such as:
The importance of a good credit score in obtaining the best California home mortgage loan cannot be understated. It doesn't matter if your prospective California home loan is a Bay Area home loan, or a San Jose home loan. San Francisco home loans, San Diego mortgages, San Jose home loans, or Los Angeles home loans, Santa Barbara mortgages, Sacramento mortgages, Southern California mortgages, Fresno mortgages -- all fall under the same credit scoring system. It doesn't matter where you are in California or anywhere in the country. Other key information on your credit report includes the following: Types of Accounts (whether a revolving, installment loan, real estate loan including HELOCs).
There are three primary credit reporting agencies who tabulate those "on the grid." They are:
Here are their respective addresses and toll-free numbers.
Bad Credit Mortgage Loan -- Misc.Do credit bureaus make mistakes? Yes, they do. Literally one out of three credit reports have a mistake on them. When I first obtained mine, I immediately detected two: tradelines I had closed a few years previous were still being shown as active. It takes 10 years for a bankruptcy to drop from your credit report. It takes four to six years for a foreclosure to drop from your credit report. Your credit score is called "FICO" which stands for Fair Isaac Company out of San Rafael, California. This is the organization that created the software to synthesize all the information found in a credit report and to give it a score. At the initial signing of loan documents, the borrower signs a Borrower's Authorization Form. This allows your California home loan mortgage broker to legally draw your credit report. It is illegal for anyone to draw your credit report without your express written (and signed) approval. Credit reports are usually around $20 to purchase. They are good for approximately 60 to 90 days.Lenders typically take your middle score as the one best representative of your credit worthiness.
How Do I Improve My Credit Report Score?There are many companies who charge for information as to how best to improve one's credit score. Books have also been written, cleanup services have been offered, and aggressive tactics have also been utilized in such an endeavor. I can tell you from experience that the best way to improve your credit score is to MAKE EVERY PAYMENT ON TIME. Yes, it's that simple -- really. At one point, I owned six properties. I won't bore you with the details but suffice it so say, I lost a lot of money in the process. My credit score sunk to 530, a very bad score, yet a year and a half later, it was 726 -- four points shy of an A+ rating (it's not in the 740s). How did I do it? Did I employ a credit cleaning service, buy a book, no. I simply straightened out my financial ship and made sure every payment was made on time. I'm not saying that employing a service to clean up your credit isn't a good thing, it can be. I can tell you from experience, my own and that of others, that is isn't always the case. One thing you can do to improve your credit is to write the credit bureaus (better to call but be polite) and see if you can't have errors corrected or items dropped. If you can present evidence to the loan agency or institution that loaned you money in some capacity, that your case was a challenged one, they may inform the agencies to drop the late or injunction on your report. Send copies of evidence that can exonerate or at least mitigate your credit problem. Be patient. Minimize your tradelines. Many tradelines can cause your sore to lower -- even if you're making every payment on time. Why? Because tradelines mean available credit or "creditability" and therefore a drag on your score. How Are Credit Scores Tabulated?The reporting agencies have a mathematical model or formula they utilize for tabulating your score. The following is how your credit report is scored and its meaning to a prospective home loan underwriter. Fundamentally, a credit score is how the lender evaluates the risk with a particular loan seeker. Credit scores range from 340 to 820, the minimum and maximum respectively. The higher the score, the better a risk the lender thinks you are. Generally speaking, scores 700 and over will get you the best loans, or as we say in California home mortgage loan parlance "A-paper loans."
The higher your score, the less risk a lender believes you will be. As your score climbs, the interest rate you are offered will probably decline. |
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