Posted on: 05th Aug, 2005 06:16 am
Mortgage lenders use a credit score in order to determine whether you can qualify for the loan. The score is based on the information that is provided on your credit report. This score is taken into account while charging the interest rate on your loan. And, if you can maintain your credit score, then you will be saving a huge sum in the interest.
Each and every lender sets his own criteria including the credit score required for approving mortgage loans. Lenders also consider the debt-to-income ratio while judging your financial strength of paying off the loan. Based on your credit score and debt-to-income ratio, lenders provide you with a credit rating that proves how creditworthy you are.
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How do lenders rate you on the basis of credit score?
Each and every lender sets his own criteria including the credit score required for approving mortgage loans. Lenders also consider the debt-to-income ratio while judging your financial strength of paying off the loan. Based on your credit score and debt-to-income ratio, lenders provide you with a credit rating that proves how creditworthy you are.
| Rating | A | B | C | D | E |
| Credit Score | 660 or higher | 620 to 659 | 580 to 619 | 550 to 579 | Below 550 |
| Debt-to-Income Ratio | Lower than 35% | Around 50% | 55% or higher | Around 60% | Around 65% |
| Late Payment | |||||
| Mortgage | No late payment for past 2 years. | 30 days late for once or twice in past 1 year. | 30 days late for 3 to 4 times in past 1 year. | 30 days late for 2 to 6 times and 60 days late for once or twice in past 1 year. | Late for 20, 60, 90 and/or 120 days. |
| Installment Loan | 30 days late for once within past 2 years. | 30 days late for 2 to 4 times during last 1 year. | 30 days late for 4 to 6 times during past 1 year. | Few 90 and 120 days late payments since past 1 year. | Late for 20, 60, 90 and/or 120 days. |
| Revolving credit | 30 or 60 days late for once in past 2 years. | 30 days late for at least 2 times in last 1 year. | 60 days late for 2 to 4 times in last 1 year. | Few 90 and 120 days late payments since past 1 year. | Late for 20, 60, 90 and/or 120 days. |
| Other Criteria | Good credit profile for last 5 years, no bankruptcy within the last 10 years. | No 60-day late payment. Discharged from bankruptcy 4 years ago. | Discharged from bankruptcy 2 years ago. | Discharged from bankruptcy within last 1 year. | Bankruptcy or foreclosure. |
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How do lenders rate you on the basis of credit score?
It depends on what type of bankruptcy it was.
Chapter 13 you would need to wait 12months from the date of filing.
Chapter 7 is basically 24months from the date of discharge.
There are other things that an Underwriter looks at like your credit score, down payment, job history, etc.
Chapter 13 you would need to wait 12months from the date of filing.
Chapter 7 is basically 24months from the date of discharge.
There are other things that an Underwriter looks at like your credit score, down payment, job history, etc.
really good info dude but can u provide some further detail about category C
what am i missing here as i read these posts?
but are there any standards which can help us to detect whether online detail is reliable or not?
i think the best standard is common sense. if someone is promising something that sounds too good to be true, then it probably is. and so on, and so on.
Agree with that
When somethign si too good to be true, double check the details and ask more questions
When somethign si too good to be true, double check the details and ask more questions
i don't think asking more questions is going to work, sunny. the reason i say that is that these companies who are offering these too-good-to-be-true deals will have every answer you ever imagined. they are so slick that they manage to sell their foolishness to highly-educated people as well as the uneducated and gullible.
better to just plain walk away.
better to just plain walk away.
Hi, I want to know if paying on time in our aprtment monthly rent can help build my credit? answer pls
As a general rule, rental payments are not incorporated into credit bureau files. There has been lots of discussion about this over the years, but we've not found it to be consistent. Of course, private landlords don't have the time, energy or money to be working with credit agencies and reporting their tenants' performance. If you're in a large apartment complex, you may find this to be a more regular practice, however.
One thing you can be certain about is that the non-payment of rent will surely catch up to those who do it. Landlords are happy to try to recover their losses, usually by way of a lawsuit, and any judgments obtained are regularly picked up by the bureaus.
If you are one of those who lacks credit in general, then a rental reference is always valuable. In fact, even given a good credit record, a reference from a landlord is often desired and obtained by creditors.
One thing you can be certain about is that the non-payment of rent will surely catch up to those who do it. Landlords are happy to try to recover their losses, usually by way of a lawsuit, and any judgments obtained are regularly picked up by the bureaus.
If you are one of those who lacks credit in general, then a rental reference is always valuable. In fact, even given a good credit record, a reference from a landlord is often desired and obtained by creditors.
I love that credit info chart! That is more information in one post than I have typically seen on these forums and lays out a clear guide to try to aim for in order to know how you're progressing when it comes to credit repair.
What has been everyone's experience with positives and negatives on credit reports? What ways can you get more postives and less negatives by opening new lines here and there? I've tried some things over the past three years and have just started to talk about some of my trials and errors over at a new blog I started called armchaircreditrepair.blogspot.com. You're welcome to read some of my stories, especially about some of my own personal bouts with defaults, rebuilding with new credit lines and cards, experiences with different lines of credit and banks, and some of the crap that you have to go through just to get your credit right. Everyone is right though, there is no magic bullet per say, but there are some ways to manage your outcome, and that's the key. Half the battle is just having the knowledge and trying to adjust your personal life and experiences to that knowledge in a way that gets you close to where you want to be, despite the mess!
What has been everyone's experience with positives and negatives on credit reports? What ways can you get more postives and less negatives by opening new lines here and there? I've tried some things over the past three years and have just started to talk about some of my trials and errors over at a new blog I started called armchaircreditrepair.blogspot.com. You're welcome to read some of my stories, especially about some of my own personal bouts with defaults, rebuilding with new credit lines and cards, experiences with different lines of credit and banks, and some of the crap that you have to go through just to get your credit right. Everyone is right though, there is no magic bullet per say, but there are some ways to manage your outcome, and that's the key. Half the battle is just having the knowledge and trying to adjust your personal life and experiences to that knowledge in a way that gets you close to where you want to be, despite the mess!
Go to "annualcreditreport.com" you can cheking for free but it doesn't but the only information that they aren't provide is the score, it is the only website free and legal to check your credit.
[Link deactivated as per forum rules. Thanks.]
[Link deactivated as per forum rules. Thanks.]
However, it should be noted that annualcreditreport.com will offer a free credit report only once a year.
Mortgage companies pull a tri-merged or "mortgage credit report" when trying to qualify a mortgage applicant. They will look at the middle score which is the middle score of the three credit reporting agencies - TransUnion,Equifax and Experian. For example, TransUnion reports 800,
Equifax - 780 and Experian 740. Your middle score is 780.
This is the score the lender will use when considering what loan products you will be eligible for. The lower the score, the fewer loan product types you might be eligible for. Your credit score is only one part of assessing your credit risk, however.
Jon
Equifax - 780 and Experian 740. Your middle score is 780.
This is the score the lender will use when considering what loan products you will be eligible for. The lower the score, the fewer loan product types you might be eligible for. Your credit score is only one part of assessing your credit risk, however.
Jon
Hey Jessica! Thanks for clearing my confusion. I was aware that each lender sets his own rate, the good credit score we have, the good chances are there to get loan. So it is important for us to maintain our credit score.
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Get your credit report for free at http://www.freecreditreport.com/
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Get your credit report for free at http://www.freecreditreport.com/
Hey Jessica! Thanks for clearing my confusion. I was aware that each lender sets its own rate, the good credit score we have, the good chances are there to get loan. So it is important for us to maintain our credit score.