How Do You Score?

Ever wonder how your FICO Score is determined? As a property manager I'm always checking applicants to rent credit history & FICO scores. It's an important part of the screening which comes down to numbers: income numbers, credit numbers and phone numbers of past landlords (at least 2).

According to all three reporting companies: Experian (seems to be the most used) Equifax & TransUnion here is the criteria:

*What Factors Raise Your Score:

• Experian & Equifax: You have Paid your bills on time and currently do not have any overdue accounts or derogatory information reported: collections, charge-offs, bankruptcies, etc.

• Experian, Equifax & TransUnion: You have a good Cushion of available credit between your current balance and your credit limits on all open trades. This cushion demonstrates to the lenders that you are unlikely to overextend yourself financially.

• Experian, Equifax & TransUnion: You have at least 2 or more open major credit cards: Visa, Mastercard, American Express or Discover on your credit report. This demonstrates to lenders that you are a responsible borrower which makes it more likely to be viewed as a "good" credit risk and extend you credit.

• Experian, Equifax & TransUnion: Your credit does not contain negative public records: bankruptcy, tax lien, IRS lien, mechanic's lien, liens etc., lawsuits or judgments in the last 2 years. Public record items can remain on your credit report for 7-15 years, depending on the item. (Which is why it's always better to short sale over foreclose your home. Short sales in general affect you 2-3 years whereas foreclosures can remain on record for 7-10 years-TJN).

• TransUnion: You have worked a long time buildings credit history, which is affecting your credit score positively. Consistently paying on-time over a long-term is one way you are viewed as responsible with your credit by lenders.

*What Factors Raise Your Score:

• Experian, Equifax & TransUnion: You do not have any real estate loans. Lenders place high value on the skill and discipline it takes for a borrower to obtain and maintain real estate loans than other types of accounts. There is an increase in borrowers' credit worthiness when they carry and pay on time, a real estate loan.

• TransUnion: Your payment history shows 1 or more late payments by 30 days or more. Late payments are viewed as negative and depending on what the late account is, can stay on your report for 7-10-15 years.

Locally, I recommend: FBS Property Management in San Diego, ask for Pam Neillo www.FBS-PM.com

For credit counseling and repair I recommend: Eran Sinai @ West Coast Law Group http://www.creditcra.com/

If you need a great Bankruptcy Attorney Eran has them in his SD, LA & SF-CA offices or you may contact locally in San Diego:

Attorney At Law: Thomas M. Lockhart, Sr. @ http://www.lockhartandbritton.com/

LOCKHART & BRITTON
7777 Alvarado Road, Suite #622
La Mesa, CA  91942
Voice: 619-698-6800
Fax: 619-698-2957

* Information was compiled from www.freecreditreport.com and Experian, Equifax & TransUnion. Readers should do their own research to verify all info. I'm sharing what I have learned through my own property management experience over the past 26 years. I am not affiliated with any credit reporting service or company.