If you need assistance, please call 239-641-3322

FICO Score consists of.....

Monday, March 25, 2019   /   by Skye Leber

FICO Score consists of.....

Credit Scoring

A major reason Fannie Mae and Freddie Mac lenders are willing to make immediate loan decisions is credit scoring. Credit scoring uses statistical samples to predict how likely it is that a borrower will pay back a loan. To develop a model, the lender selects a large random sample of its borrowers, analyzing characteristics that relate to creditworthiness. Each of the characteristics is assigned a weight, based on how strong a predictor it is. Credit scores treat each person objectively because the same standards apply to everyone. Credit scores are blind to demographic or cultural differences.

Credit scores are used for purposes other than loan qualification. Insurance companies evaluate risk based on credit scores. Sometimes, people find it hard to get insurance because low credit scores have been associated with higher claims experience. Because people with higher scores seem to have fewer claims, their rates are generally lower. Many companies use credit scores in their hiring process. Partly because the recession damaged the credit scores of people who lost their jobs or defaulted on their mortgages, some states have passed laws that don't allow the credit scores to be a factor in the hiring decision.

The most commonly used credit score today is the FICO score. FICO scores range from 400 to 900. Low scores predict that the borrower is more likely to default on a loan.

Interestingly, each person has several credit scores for the FICO scoring model, because each of three national credit bureaus, Equifax, Experian, and TransUnion, have their own databases. Data about an individual consumer can vary from bureau to bureau.

A person's FICO score consists of the following components:

  • Payment history—35% of the score is determined by payment histories on credit accounts, with recent history weighted a bit more heavily than the distant past.
  • Debt utilization—30% is based on the amount of debt outstanding with all creditors as a percentage of the total available credit limit.
  • Credit history—15% is produced on the basis of how long the borrower has been a credit user (a longer history is better if there have always been timely payments).
  • Recent credit searches—10% is comprised of very recent history and whether the borrower has been actively seeking (and getting) loans or credit lines in the past months.
  • Types of credit—10% is calculated from the mix of credit held, including installment loans (like car loans), leases, mortgages, credit cards, et cetera.
Need help buying a home? Not sure where to begin? Call our team at 252-331-9474! We would love to help! 

EXP Realty Platinum Team
www.eXpPlatinumTeam.com 

#ficoscore #creditrepair #lender #buyingahome #expplatinumteam #callourteam

Information courtesy of Continuing Education Bob Hogue Knowledge Hub 2019

  naples, naples florida, exprealty, forsale, realestate, exprealestaterockstars, secondhome, sold, new agents, platinumteam, buyingahome, creditrepair, ficoscore, lender

eXp Realty - Platinum Team
239-641-3322
252-331-9474
Mike Swaleh
Co-Branch Manager
Office: 314-478-3699
Email: mike.swaleh@fairwaymc.com
NMLS# 739145

The source of this real property information is the copyrighted and proprietary database compilation of the Southwest Florida MLS organizations Copyright 2021. Southwest Florida MLS organizations. All rights reserved. The accuracy of this information is not warranted or guaranteed. This information should be independently verified if any person intends to engage in a transaction in reliance upon it. The property information herein is derived from various sources that may include, but not be limited to, county records and the Multiple Listing Service and it may include approximations. Although the information is believed to be accurate, it is not warranted and you should not rely upon it without personal verification.
2021 Royal Palm Coast REALTORĀ® Association. All rights reserved. Information has not been verified, is not guaranteed, and is subject to change. The data relating to real estate for sale on this web site comes in part from the Internet Data Exchange (IDX) of the Florida Gulf Coast Multiple Listing Service, Inc. Real estate listings held by brokerage firms other than Deb Farha - Naples Platinum Properties / MVP Realty IDX logo and detailed information about them includes the name of the listing brokers. The information being provided is for consumers personal, non-commercial use and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing. Last Updated: 8/5/2021 4:31 PM CST
The data relating to real estate for sale on this limited electronic display comes in part from the Southwest Florida Multiple Listing Services. Properties listed with brokerage firms other than Deb Farha - Naples Platinum Properties / MVP Realty are marked with the BR Program Icon or the BR House Icon and detailed information about them includes the name of the Listing Brokers. The properties displayed may not be all the properties available through the BR Program. The source of this real property information is the copyrighted and proprietary database compilation of the participating Southwest Florida MLS organizations and is Copyright 2017 Southwest Florida MLS organizations. All rights reserved. The accuracy of this information is not warranted or guaranteed. This information should be independently verified if any person intends to engage in a transaction in reliance upon it. Some properties that appear for sale on this limited electronic display may no longer be available. For the most current information, contact Deb Farha - Naples Platinum Properties / MVP Realty Data last updated 8/5/2021 4:31 PM CST.
Ā© 2021 My Florida Regional MLS DBA Stellar MLS, Inc.. All rights reserved. The data relating to real estate displayed on this website comes in part from the Internet Data Exchange (IDX) Program of My Florida Regional MLS DBA Stellar MLS, Inc. All listing information is deemed reliable but not guaranteed and should be independently verified through personal inspection by appropriate professionals. Listings displayed on this website may be subject to prior sale or removal from sale; availability of any listing should always be independently verified. Listing information is provided for consumers' personal, non-commercial use, solely to identify potential properties for potential purchase; all other use is strictly prohibited and may violate relevant federal and state law.8/5/2021 4:31 PM CST
This site powered by CINC: www.cincpro.com
--------------------------------------------------->