Credit? Who Needs Credit?
Your credit score isn’t just a number—it’s your ticket to better rates and lower payments!
Credit scores: Love ’em or hate ’em, they’re kind of a big deal! 💳 Your scores show if your finances are in tip-top shape and can even impact how much credit you can snag. Think of it as your financial report card—so, treat it like the VIP it is! 📊💥
A credit report shows all the juicy details about your credit life, like how well you’ve been paying those bills and the status of your accounts. Think of it as your credit’s “tell-all”—and here’s what’s inside: 👇
Personal information
- Your name and any name you may have used in the past in connection with a credit account, including nicknames
- Current and former addresses
- Birth date
- Social Security number
- Phone numbers
Credit accounts
- Current and historical credit accounts, including the type of account (mortgage, installment, revolving, etc.)
- The credit limit or amount
- Account balance
- Account payment history
- The date the account was opened and closed
- The name of the creditor
Collection items
Public records
- Liens
- Foreclosures
- Bankruptcies
- Civil suits and judgments
A credit report may include information on overdue child support provided by a state or local child support agency or verified by any local, state, or federal government agency.
Inquiries
- Companies that have accessed your credit report
Credit reports are created by credit reporting agencies (CRA). The three major credit reporting agencies are Transunion, Experian & Equifax. The CRA acts as an independent party which ultimately scores your financial performance based on your history of fulfilling the terms of the contract agreed upon at the consummation of the loan or agreement. The primary purpose of the CRA is to ensure that creditors have the information they need to make decisions.
The information reported on a credit report is used by creditors (banks, credit card companies, car dealerships, mortgage companies, etc.) engaged in extending credit or lending money. The information reported by the CRA is strategically used by creditors to help them determine the potential risk associated with everyone they consider lending money to. Just as creditors use information to make decisions, they report your performance, or lack thereof to warn other creditors of one’s (in)ability to maintain and fulfill the terms of the initial agreement or contract.
The ability to obtain and maintain a high credit score is directly tied to our actions. The more responsible we are in taking on debt, paying our debts in a timely manner and eventually paying off balances, demonstrates a history of financial responsibility. This competence ultimately drives credit scores up. Not making payments on time, or in full demonstrates financial irresponsibility, which drives credit scores down
How To Find Your Credit Score?
If you know EXACTLY what your credit scores are with all 3-credit bureaus, then you are more loan ready than most! If you aren’t sure exactly what your credit scores are and haven’t checked them in a while, go to freecreditreport.com and you can access your credit report for free. You can also go directly to the three major credit reporting agencies (Transunion, Equifax, Experian) and request your credit scores from them. Regardless of where or how you get your credit report, obtaining a credit report once year will help you analyze your scores and begin to understand why you have the scores that you do.
Once you have a credit report, you can begin to analyze the reported data driving your credit scores. As you begin to see the data reported on your credit report, it will hopefully change the way you act as a consumer. A credit score can be an asset you can leverage to help improve your financial situation. It’s imperative that you understand how to your credit’s potential and take corrective actions if needed.
Below will give you a general idea as to how a credit score is viewed by creditors:
- Credit score of 721 and above is considered Excellent
- Credit score of 681 – 720 is considered Good
- Credit score of 651 – 680 is considered Average
- Credit score of 601 – 650 is considered Bad
- Credit score of 601 and below is considered Poor
Regardless of where your credit score currently is, you can make corrective actions to improve it! Call the LenditHome team to identify your credit score and what if anything needs to be done to get you loan ready.
Have questions? Give us a call! One of our mortgage specialists would be happy to answer all of your questions.