In a major announcement, Experian, one of the three major credit reporting bureaus, have declared that consumers will not have access to their FICO credit score. This rule will be effective from this month. Experian has also informed Fair Isaac Corp. that it is terminating its relationship with myFICO.com which sells FICO credit scores directly to consumers.

Thus, from now onwards Experian customers will not be able to check out their FICO scores which the lenders are using while determining their credit level. Consumers can take a look at their Experian FICO score by contacting their lenders. However, consumers can still obtain their FICO scores from Equifax or TransUnion.

Lenders have always preferred using the Fair Isaac Corp’s technology to make credit decisions each year. A mathematical formula is applied in order to decide a consumer’s credit history. The factors taken into consideration are more or less the same for all the three credit bureaus which helps them produce a 3 digit score. This score helps the lenders to judge a person’s likelihood of repaying the debt.

A lot of people are of the opinion that this decision of Experian is the result of a fall out between Experian and Fair Isaac. The latter had also filed a lawsuit against Experian, Equifax and TransUnion in 2006 as they have developed a different credit score model called VantageScore. However, whatever be the reason for such a decision, it will now become difficult for the consumers to know what most lenders are using to grade them as they will not have a direct access to Experian’s score.

Mortgage Modification, also known as loan modification, has become quite popular in the recent times. Borrowers who are unable to refinance or go for any alternative repayment plan in order to avoid foreclosure may choose loan modification.

In a mortgage modification, the lender may extend the loan period or reduce the interest rate with the aim to minimize your monthly payments. However, he will add any mortgage dues to the outstanding loan balance. Thus, at times a loan modification can raise your payments as well.

There are certain criteria which should be kept in mind while applying for a mortgage modification. Borrowers can apply for a loan modification if the lender hasn’t declared a foreclosure. Borrowers should be delinquent on their loan payments for at least a month. The property should be in good physical condition when the borrower applies for a loan modification. Moreover the loan should have been originated for more than a year.

The borrower should write a hardship letter to the lender in order to apply for a mortgage modification. In this hardship letter, the borrower should inform the lender about his hardship which resulted in the non-payment of the mortgage dues. If the lender is convinced, he will accept the borrower’s request. The borrower can also take the help of a loss mitigation expert who will negotiate with the lender regarding the loan modification.

With the recent downfall in the real estate market, lots of people are facing issues regarding their mortgage payments. Loan modification offered by the lenders is a sort of bailout program for these people. This helps them in saving their credit and their home.