What is FICO?
FICO scores are
numbers calculated based upon your credit history. The
better your credit, the higher your number or score will be - the worse
your credit, the lower the score. In some instances, lack of credit
result in "no score" on your report requiring you to provide
"alternative credit" via your rental, utility or telephone payment
histories.
There are some
lenders that do not use this manner of scoring to the degree that most
do. Many times, when credit reports contain inaccuracies
that lower your score, you will need to obtain a lender that does not
scrutinize the score you may have. Talk with your mortgage broker or
lender to understand what your options are!
Functionally, FICO
scoring is a tool used to "simplify" the approval process in the
mortgage lending industry - to the contrary many brokers and lenders
feel this manner of scoring creates more problems.
To give you a
general idea, we have included the scoring portion of a "sample" credit
report. You will not only notice the scores, but also the four main
factor which lowered your score. We have included on this page the
things that can bring your score down. (or how you can bring it up!)
*****Borrower: DOE, JOHN M.
*****
TU Score: [00627]
Reason1=[022] Reason2=[016]
Reason3=[028] Reason4=[004]
TRW Score: [00631]
Reason1=[022] Reason2=[016]
Reason3=[028] Reason4=[004]
Equifax Score: [00619]
Reason1=[022] Reason2=[016]
Reason3=[028] Reason4=[004]
|
Reason |
TRW |
TU |
EQUIFAX |
|
Amount
owed on accounts is too high |
1 |
1 |
1 |
|
Delinquency
on Accounts |
2 |
2 |
2 |
|
Too
few bank revolving accounts |
3 |
N/A |
3 |
|
Too
many bank or nat'l revolving accounts |
4 |
N/A |
4 |
|
Too
many accounts with balances |
5 |
5 |
5 |
|
Consumer
finance accounts |
6 |
6 |
6 |
|
Account
payment history too new to rate |
7 |
7 |
7 |
|
Too
many recent inquiries last 12 months |
8 |
8 |
8 |
|
Too
many accounts opened in last 12 months |
9 |
9 |
9 |
|
Proportion
of balances to credit limit too high |
10 |
10 |
10 |
|
Amount
owed on revolving accounts is too high |
11 |
11 |
11 |
|
Length
of revolving credit history is too short |
12 |
12 |
12 |
|
Time
since delinquent is too recent or unknown |
13 |
13 |
13 |
|
Length
of credit history is too short |
14 |
14 |
14 |
|
Lack
of recent bank revolving information |
15 |
15 |
15 |
|
Lack
of recent revolving account information |
16 |
16 |
16 |
|
No
recent non-mortgage balance information |
17 |
17 |
17 |
|
Number
of accounts with delinquency |
18 |
18 |
18 |
|
Too
few accounts currently paid as agreed |
19 |
27 |
19 |
|
Time
since derogatory public record or collection |
20 |
20 |
20 |
|
Amount
past due on accounts |
21 |
21 |
21 |
|
Serious
delinq., derog. public record or collection |
22 |
22 |
22 |
|
Too
many bank or nat'l revolving accts w/ balances |
N/A |
N/A |
23 |
|
No
recent revolving balances |
24 |
24 |
24 |
|
Proportion
of loan balance to loan amt too high |
33 |
3 |
33 |
|
Lack
of recent installment loan information |
32 |
4 |
32 |
|
Date
of last inquiry too recent |
N/A |
19 |
N/A |
|
Time
since last account opening too short |
30 |
30 |
30 |
|
Number
of revolving accounts |
26 |
N/A |
26 |
|
Number
of bank revolving or revolving accounts |
N/A |
26 |
N/A |
|
Number
of established accounts |
28 |
28 |
28 |
|
No
recent bankcard balances |
N/A |
29 |
N/A |
|
Too
few accounts with recent payment information |
31 |
N/A |
31 |
