Some tidbits on FICO scores

If you are in the market to buy a home one ver important component of your interest rate is your FICO score.

How are FICO scores determined.

Answer:
The formula itself is complicated and the FICO company (Fair Isaac Corp) keeps it secret. But here are the basic components:

• A.   35%   Past Delinquencies
  Your payment history
• B.   30%   Debt Ratio
  Your revolving account balances divided by their limits, as a percentage
• C.   15%   Average Age of File
  Length of your account history
• D.   10%   Mix of Credit
  Mix of account types on your report
• E.   10%   Inquiries
  # times you applied for credit in the last 12 months

This info is courtesy of Derrick Evens of Perfect Credentials.
http://www.perfectcredentials.com/

Want a referral to excellent mortgage brokers I have worked with, send me an email.

A few little tidbits I read today

…Ugly little secret: Even APPLYING for a loan modification can whack your credit. A lender tells me getting a loan mod devastated one client's FICO scores by 130 points

FICO scores are a complicated puzzle. No matter where I turn I get a huge variety of answers regarding how much your credit score will take a hit if you miss several payments on a credit card versus declaring bankruptcy.