Your FICO score is one of the main factors that a lender will use to approve you for a home loan. The others will be your Income and length of employment. Your FICO Score is very important to them because it paints a picture of how you have managed credit in the past.
It sums up everything that is included on your credit report and turns it into a 3 digit number. Most people don’t know where to turn to get their scores but from personal experience I would advise you to visit a home lender for your scores. Why?
Because there are different versions of scores out there and you want to get your hands on the version you are going to be judged by. Keep in mind that the main reporting agencies (Equifax, Transunion and Experian) each have a score which is different from one another.
Lenders will pick the middle score of the three. So for instance, you have a 620 score with Equifax, a 595 score with Transunion and a 656 score with Experian, they will not the highest score, not the lowest but the number that’s in the middle.
That’s why its important to work on all three reports before you go shopping for a home loan.
The middle score is whats used to determine the Interest rate you will get. Home loan lenders have a graph and beside each interest rate, there is a corresponding credit score. The higher the score, the better chances you will get a loan and at a lower interest rate.