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What creates a credit score?

By
Services for Real Estate Pros with Consultant

Credit scores are important to folks considering buying almost anything today. They also impact your employment-more and more Employers are checking your credit to see if you are $ savvy prior to a hiring decision. Fixing errors can make a difference. Check out the "how to" video and find the forms you need right here.

Credit scores can range from 350-850 and are composed of:

  • 35% is your payment history
  • 30% is based upon how much debt you have
  • 15% is based upon the length of your credit history
  • 10% is the type of debt (revolving, installment, mortgage)
  • 10% is based upon whether or not you have a lot of new accounts

***Our favorite lenders are reporting that a 680 credit score is a doable loan right now. Make that a good target if you are below that number.

Improving your score can be helped by:

  1. Paying your bills on time
  2. Do not max out your credit cards or revolving debt plans
  3. Do NOT open many new accounts or apply for many in a short period of time(the exception is for mortgages-you may speak to several different lenders in a 2 week period and it only counts as one inquiry.)
  4. Do not Close accounts especially if open for a long time even if they have a zero balance
  5. Check your report annually for FREE 

How to start a credit score:

  • Start by applying for a credit card. Try the bank or the department store first
  • Lenders and REALTORS are in a position to help consumers see what needs to be done to improve their credit ratings. In some instances it may be better to wait and work on improving their credit rating then being able to qualify for a better loan rate.

NOTE: Copyright 2009 Texas Association of REALTORS. Page 23 in TAR housing initiatives program. (Affordable housing certification.)

***Personal note-FICO can not be had "for Free" When you speak with a lender or pay an online company you can learn your FICO score. FICO is another formula kind of scoring plan.

Send me an e-mail to http://mailto:helpRhome@yahoo.com for a FREE website to learn about your creditworthiness and make some plans for the future.  When the interest rates and the number of properties are at the present levels it is truly a BUYERS market and right now the whole country is           FOR SALE!

 ***Comments attributed to my personal opinion or information.

Posted by

Doris Barnett NAR Certified e-PRO Trainer

RE/MAX Associates of Dallas 

1221 Abrams #130

Richardson, TX 75081

972-907-0000 x 212

 

Earl Miller
Coldwell Banker Solano Pacific - Benicia, CA
Solano County, Contra Costa,Benicia Real Estate, 707-280-6366

I recently had to file BK, because when it was good I bought many properties. To keep up with all the mortgage payments it was costing me upwards of $10,000 a month....had to pull back. Sold 4 properties, but still own 6 in Mexico and a Mobile Home Park. Credit score went from just under 800 to just above 600. Will make it back to 800 but it is going to take a while. Never missed a bill in 22 years.

Aug 26, 2010 04:25 AM
Edward & Celia Maddox
The Celtic Connection Realty - Queen Creek, AZ
EXPERIENCE & INTEGRITY - WE TAKE THE HIGH ROAD

Thanks for sharing info on credit score.  Good article to pass on to clients.

Aug 26, 2010 04:27 AM
Doris Barnett-214-236-2908 cell/txt
Consultant - Plano, TX
Real Estate Consultant: Ask for your Better Biz

Earl, I am sure you will find your way back and I am seeing folks trying to help those who have been there on this. Too many to count! It has convinced the country that the credit scores are pretty important in our lives. While at the moment maybe not so much. When we find a good one there are certainly scrambles to serve them the best way you can!

Ed and Celia, Thanks I felt the same way. It is so important that I had to help get this information out there. There are things we need to teach all of our children and perhaps this is one of the biggies! How to handle our money properly and the impact of not doing so. Even those of us who get it-didn't have the crystal ball so even when it's done right we couldn't have planned for what happened on this one! If the Fed is still scratching their head how can we feel like we should have done something differently, eh?

Aug 26, 2010 04:55 AM