Question:

How are your mortgage and credit rating bureau related?

Answer:

The answer is simple. Your mortgage and the credit rating bureau are correlated because the FICO score is one of the top markers of your trustworthiness as a borrower. In fact, there are different credit rating bureaus in the US, the major being Equifax, Experian and TransUnion. Another, and supposedly more precise, is the Innovis credit rating bureau.

All the credit rating bureaus provide a FICO score that may differ more or less. This is why a 3-in-1 credit rating report is sometimes required by lenders.

How is your FICO score, and mortgage, affected by the credit rating bureau report?

Your mortgage terms are incredibly dependent on your FICO score, provided by the credit rating bureaus. A score over 700 will get you very nice rates; a score below 620 is considered subprime and you may like to work and improve it, or you may get into a real mess.

Your FICO score is generally affected by your credit report items in the following way:

  • Payment History  35%
  • Amounts Owed 30%
  • Length of Credit History 15%
  • Taking on more debt 10%
  • Types of credit in use - Mortgage, auto, consumer accounts, or revolving and installment loans 10%

However, the FICO score algorithm is not available to the public, so no one knows exactly how FICO is calculated, except that bankruptcies and foreclosures severely hurt your FICO and stay for at least 7 years on your credit report.

Recommended helpful present and future homeowners links:
Why: Refinance to a fixed rate loan while mortgage rates are still low.
Link:
Why: Because FHA loans are insured by the US Federal Government they have very competitive interest rates and are easier to qualify.
Link:
Why: Know and protect your credit report and score.
Link: See All 3 National Credit Scores & 3 Reports Instantly, Online & Free
Why: Find your next home and save money.
Link: Search thousands of foreclosures. Free 7-day trial.
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Common misspellings: mortage and morgage