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WHAT’S A FICO®?

What is a FICO® Score?

FICO® stands for Fair Isaac & Company and is the name for the most well known credit scoring system, used by Experian. The credit bureau’s computer evaluates a complete credit profile and assigns a score, which is used to estimate credit worthiness. Each of the three bureaus (Experian, Trans Union, Equifax) employs its own scoring system, so a given person will usually have 3 separate scores. Someone with a higher score will be viewed as a better risk than someone with a lower score. Typically, scores will range from about 600 to 700 or above, although some cases will be outside this range.

What Kind of Score Do I Need for a Home Loan?

There are as many answers to this question as there are loan programs available. Most lenders will take the average of all 3 scores to evaluate an application. Niche loans, such as Easy Qualifier and low down payment loans will have higher FICO® requirements.

How is My Score Determined?

The FICO® model has 5 main elements:

  1. Past payment history (about 35% of score) The fewer the late payments the better. Recent late payments will have a much greater impact than a very old Bankruptcy with perfect credit since.
    Myth - paying off cards with recent late payments will fix things. Payoffs do not affect payment history.
  2. Credit use (about 30% of score) Low balances across several cards is better than the same balance concentrated on a few cards used closer to maximums. Too many cards can bring down the score, but closing accounts can often do more harm than good if the entire profile is not considered. BE CAREFUL WHEN CLOSING ACCOUNTS!
  3. Length of credit history (15% of score) The longer accounts have been open the better for the score. Opening new accounts and closing seasoned accounts can bring down a score a great deal.
  4. Types of credit used (10% of score) Finance company accounts score lower than bank or department store accounts.
  5. Inquiries (10% of score) Multiple inquiries can be a risk if several cards are applied for or other accounts are close to maxed out. Multiple mortgage or car inquiries within a 14 day period are counted as one inquiry.

How Can I Raise My Score

Your score can only be changed by the way that item is reported directly to the credit bureaus (Experian, TU, Equifax). Written confirmation from the creditor is required. It is best to make these corrections before you try to purchase a home, because you can never be sure the exact impact a change will have on your score.

What Does This Mean to Me?

You should have your credit reviewed BEFORE you look for a home, and work with a PROFESSIONAL loan officer to make sure your loan is based on the most accurate information.

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Thank you for visiting today. If this is your first visit, take your time and look around. We have plenty of information and resources available to you. If you are a return visitor, thank you. We would love to hear from you and tell you how we can serve all your real estate needs.

Tom Scrocco And Randy Isaacs
Realtor - Associates
Coldwell Banker Sunset Strip
 PLEASE CALL US ANYTIME:
310-259-7355 and 310-435-1494

RandyAndTomHomes@gmail.com
BRE: 01245433, BRE: 01252713

Testimonials

From our first meeting Tom and Randy presented a perfect combination of professionalism and personal warmth. Their knowledge of the real estate business is comprehensive, and their concern for my particular needs was exemplary. They guided me through the entire process in language that made things clear to me, and through the entire process to the closing of escrow were available with expert advice and instructions. I cannot recommend them highly enough. C. Steven Smith, Producer
Randy and Tom- “It was a pleasure doing business with you. You made a difficult situation easy and painless! And we couldn't be happier with the price you obtained. Very good job!! We've already recommended you once and will certainly do it again. You were professional, caring, understanding and supportive. We thank YOU from the bottom of OUR hearts! Thank you for getting the best deal for us, including the 60 day stay. We could not have asked for more!” David and Rachelle, Producer
Tom/Randy/Cameron: Thank you all for handling the sale of my parents house in such a professional manner. The Escrow went extremely smoothly without any hitches at all. The personalized attention and advice I got throughout the entire process was second to none.You guys truly are the best. When the time comes for me to sell my own property, I will definitely know who to call. A special thanks to Randy for listening to and working with me through all the “family drama” regarding the sale. Thanks again. Cheryl Marlowe, Traffic Manager KTLA
Tom and Randy...Thank you for the BRILLIANT job you did selling our duplex!...You two possess a unique combination of razor-sharp professionalism and comforting human warmth. You were the best advocates anyone could ever want, and you obtained a better sale than we could ever have imagined. Kristin and Patrick
When we decided to sell our house we met with several real estate agents and it was clear from our first meeting that Randy and Tom were the right choice. They were professional, courteous, and extremely familiar with the local real estate market. During our time working with them on selling our house we found them to be honest, reliable, informative, persistent and always professional. We would use them again in a heartbeat and highly recommend them to anyone looking for a professional real estate partner. Megan Riley Grant, Executive Producer Monster, Andrew Grant, Writer
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