More on Credit Scores

Mortgage and Lending with Guaranteed Rate NMLS ID: 21441

 There is an abundance of misinformation about credit scores. The information below is accurate and if you have any questions please don’t hesitate to contact me.


1. The Players

    Beacon at Equifax

    FICO Risk Score at Transunion (Empirica)

    Experian/Fair Isaac at Experian


2. Main reason for FICO Scores is to predict your chances of default on a specific loan.


     Scores range from 300-850.

     Scores below 620 are considered high credit risk

     Scores over 660 are below average risk

     Scores of 720 or above are considered excellent.



3. How are the scores weighted?


   35% is established from your payment history, collections, and public records. 

   30% is established from outstanding balances being carried on your accounts.

   15% is based on your length of credit history. It is better to have credit for longer timeframes, so that a history is built up on your record.

   10% is established around the type of credit you have.

   10% is established around your request for credit (credit inquiries), meaning that every time you apply for credit, your scores are impacted within certain FICO rules. You can, however, apply for as many mortgages and car loans as you want, as long as they are in a 14-day window. FICO allows this because they are big-ticket items and it's understood you're shopping for one item.

Rich Hirsch
Senior Loan Officer
(908) 410-9066
NMLS #21441
NJ LIC #0749868  PA LIC #27282

Comments (3)

Edward & Celia Maddox
The Celtic Connection Realty - Queen Creek, AZ

Thanks for sharing the credit score information.  Good info to pass onto clients.

Feb 23, 2013 12:43 AM
Joy Daniels
Joy Daniels Real Estate Group, Ltd. - Harrisburg, PA

This is good to know.  I will reblog this in the near future.  :)  It's really important to understand credit scores and I really don't think most people do.  I will bookmark this post too.  THank you!

Feb 23, 2013 06:30 AM
Rich Hirsch
Guaranteed Rate - Short Hills, NJ
VP of Mortgage Lending

Joy, thank you for your efforts in getting the word out.

Feb 25, 2013 08:01 AM