Know Your Numbers Part 2: What is a FICO score

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Hi there and welcome back for Part 2 of Know Your numbers. Here, I will be discussing your Credit score.

What it is…

Your credit score is a three-digit number that measures your borrowing history. There are 3 main credit bureaus that each calculate their own credit score for you based on your payment history, how much debt you have, your credit limit usage, etc.

Why it matters…

Your credit score helps mortgage lenders evaluate your likelihood of paying back your loan. It’s very simple…The higher your credit score, the better the mortgage credit terms you can be offered.

Quite simply: A higher credit score —> Saves you more money.

You can get a loan with a credit score as low as 620 or lower, but plan on having more hurdles to jump over during the mortgage approval process…and limiting your home loan options

Here’s how credit scores rank today…

If you know you are buying a house or refinancing in the next few months, you can begin working on boosting that score up now so you can Reap the benefit.  This little tip could save you thousands of dollars each year. I’m Bob The Banker – Thank you for reading & next time we are going to talk about Down Payment & Loan to Value.