How Much Do You Know About Credit Scoring?
Before you get a mortgage for the first
time, or refinance your existing mortgage, lenders run a credit check.
Lenders use a scoring system to decide whether or not you are a good candidate
for a loan, and even what rate you will qualify for. Credit scores are
based on a number of factors.
NOTE: You
should have a credit score of at least 580 to be considered for a loan.
If you don't KNOW your credit score, you can find out instantly here.
How much do you know about the current
credit scoring system? Here is a 10 question quiz to help you find out:
1. True or False: Information on your credit
report is always accurate.
2. True or False: There are currently 3
nationwide credit-reporting companies.
3. True or False: An occasional bill paid
late will not show up on your credit report or affect your credit score,
unless you make a habit out of paying bills late.
4. True or False: If you have applied for
many new credit accounts recently, that could affect your credit score.
5. True or False: If you are denied credit,
you have no way of finding out why.
6. True or False: You can improve your
credit score by paying bills on time, paying down balances, and not accumulating
additional debt.
7. True or False: Improving your credit
score is a fast process.
8. True or False: If your credit score
is low, you cannot get a mortgage.
9. True or False: Credit companies may
take factors such as marital status and national origin into consideration
when evaluating your credit report.
10. True or False: Credit reports are available
free.
ANSWERS:
1. False. There are sometimes inaccuracies
on credit reports. Be sure to review your credit report before applying
for a mortgage or refinancing your home.
2. True. There are 3 main credit reporting
agencies: Equifax, Experian, TransUnion.
3. False. Any bills paid late are very
likely to negatively impact your credit score.
4. True. It may negatively affect your
credit score if you have applied for too many new accounts in the recent
past.
5. False. If you ask for the information,
the creditor is by law required within 60 days to inform you of the reasons
your application was denied.
6. True. All of these things will help
you improve your credit score.
7. False. It can take awhile to improve
your credit score.
8. False. You can get a mortgage or mortgage
refinancing even with a lower credit score though the interest rate may
be higher. There is more information on these types of mortgages on www.mortgage-refinancing-online-guide.com.
9. False. Credit companies cannot discriminate
based on these factors.
10. True. You can now obtain a free credit
report through www.annualcreditreport.com. By the way, a perfect credit
score is 850.
SCORING:
1-5 You need to learn more about credit
scoring. Go to www.mortgage-refinancing-online-guide.com, and browse the
articles. 6-8 You know a lot about credit scoring. Keep up the good work.
9-10 You might want to consider a career in mortgage loans. Great job!
Casey Smith has worked for years in the
mortgage industry and often writes for the popular website http://www.mortgage-refinancing-online-guide.com.
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