Know Your Credit Score
If you are considering buying a home, you must know your credit score, or "FICO Score'. Actually, you should always know your credit score even if you are not buying a home. Do not be afraid of it, embrace it. Your credit score is what determines if you you can get a home loan and at what interest rate. It will determine, for example, whether or not you can get a rental property, a credit card or car loan, and at what terms and interest rate. A lower score equals a much higher interest rate. Contact me to find out what the minimum required score is for a home purchase (it can change so I do not want to put incorrect data on my website).
There are three companies for credit reporting and each of them may have a different score. A mortgage lender will look at the 'mid-score' when qualifying you for a home loan.
There are many companies now that offer free credit reports online. Make sure you get a 'tri-credit' report that shows all three scores from the companies above so you know your mid-score. If it is not where you want or need it to be, work on fixing it now so you are prepared later.
About FICO Scores
Credit bureau scores are often called "FICO scores" because most credit bureau scores used in the US are produced from software developed by "Fair, Isaac and Company" or FICO. FICO scores are provided to lenders by the three major credit reporting agencies listed above. FICO scores provide the best guide to future risk based solely on credit report data. The higher the score, the lower the risk. But no score says whether a specific individual will be a "good" or "bad" customer. And while many lenders use FICO scores to help them make lending decisions, each lender has its own strategy, including the level of risk it finds acceptable for a given credit product. There is no single "cutoff score" used by all lenders. This information was obtained from www.myfico.com. You can obtain your FICO score from this web page and also see the difference in interest rates depending on your FICO score.