Credit score and your mortgage

[smilingmeng]

Credit score and your mortgage

If you have bad credit history and are looking to get a home mortgage loan, then chances are you are going to need to know all about how the FICO credit scoring system works.

FICO ? Fair ISAAC & Company ? is the leading credit reporting agency that lenders turn to when it comes time to credit scoring your home loan mortgage application; so if you do have bad credit history, these guys will know.

The formula used by FICO cannot be disclosed because of a decision made by U.S. Congress. There are some things generally known about FICO which that could help you understand why and how you can get approved:

1. The higher your FICO score, the better chance you have of getting that home mortgage loan. Also, the higher your score, the more room you have to negotiate a lower interest rate.

2. If you have a FICO score lower than 500, there is very little chance you’ll be getting a mortgage home loan.

That said, if you have a score of:

500 ? 600 you should be able to get a home mortgage loan, provided you are willing to make a down payment.

600 ? 640 You should get a 100% home loan financing. Thats right, with no money down.

640 - 700 You should be able to be approved for a 125% home mortgage loan. 700+ You’re in the drivers seat! You should be able to get an excellent rate with excellent terms.

3. FICO depends on each credit report, so before you apply for a home mortgage loan, if you have bad credit history, get a copy of your credit report and make sure there is nothing on there that shouldn’t be there. If there is, get it changed before you apply for the home mortgage loan.

4. Wait until after you have purchased or refinanced your home before you buy anything additional on credit. More loans or higher balances can have a dramatic effect on your mortgage approval, regardless of whether or not you had over a 600 FICO score before you bought on credit.

5. Remember, the FICO score is only a part of your home mortgage loan application, so if at first you don’t succeed in getting your home loan mortgage, don’t give up. Some lenders may still be willing to lend to you!

People with bad credit often don't understand how the credit scoring system works. It is beneficial to find out more about it when looking to get a home loan with less than perfect credit to bad credit or when dealing with sub prime mortgage lenders.

To view our list of recommended bad credit mortgage lenders online, visit this page: Recommended Bad Credit Mortgage Lenders

Carrie Reeder is the owner of ABC Loan Guide, an informational website

 

[Consciousness]

ha.. 727

 

[dkwan]

Is it just copy and paste off the web?

 

[dkwan]

and Does it work for Canada?

Maybe I am still new, is there any 125% loan avaliable in Canada? I see maximum 105%

 

[Consciousness]

Does the amount of morgage you get depends on the annual income? I heard the bank only lend out 300~400% of your income??

 

[dkwan]

its a rough calculation.

Max mortgage: ( combined gross(before tax) income ) * 3 + 30,000.

example:

husband(70,000) + wife( 60,000 ) income = 130,000
max mortgage = 390,000 + 30,000 = 420,000

of course, this is only a rough calculation and depends on other factors, like current debt, credit score.etc

 

[smilingmeng]

call me if you need free advice on how to repair your credit

any questions regarding to your credit , call cristin 613 5635086 , i will give you free advise on how to prepare your credit .

 

[smilingmeng]

Thanks for dkwan for detailed information!

It is true that this article copy from website, however, it is almost 99% can be applied in Canada mortgage market.