Wednesday, January 28, 2009

FICO Update

Understanding FICO Scores -

We all know how important FICO scores are so here are some basics to enhance your FICO knowledge. Good borrower credit scores help make it possible to qualify at better rates. For those with lesser FICO scores, FHA loans are available as an option.

This is how FICO Scores are weighted and structured:

35% by Payment History
30% by Balances Owed
15% by Length of Credit History
10% by New Credit
10% by Types of Credit in Use

And the overall calculated ranges:

720 - 850 Excellent, A-paper credit, the "good-guy" rates available;
680 - 719 Good, not much of a compromise on rates;
620 - 679 OK or Fair, clearly in range for FHA consideration;
580 - 619 Low, bottom of the range for FHA consideration, "alternate credit" comes heavily into play;
500 - 579 Poor, truly nothing can be done without credit rehabilitation.

Feel free to contact me for more information.

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