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 Caron
Moderator
Joined: 19 Jul 2005
Posts: 1322
Location: florida
218.39 Dollars($)
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 Posted: Fri Nov 04, 2005 2:57 am Post subject: Does a good credit score guarantee low interest rate? |
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| Quote: | | Does a good credit score guarantee low interest rate? |
A good credit score increases your chances of getting a mortgage at a comparatively low rate. But this may vary from one lender to another because lenders rate you on the basis of your score and they follow various methods for rating borrowers. This is turn affects the mortgage rates charged on your loan.
You may get a home loan even with a poor score but then you may be paying higher rates in return. So, in most cases the higher your score, the lower is the interest rate charged on the loan. When you have excellent credit, you can avail better mortgage rates. For instance, with a good score, lenders will rate you better and you may end up paying interest at 5.5% only for a long term fixed rate loan. But with scores below 650, you may be offered an interest rate 1% higher than the previous rate.
With a high credit score, you can also get refinance loans or home equity loans at better rates. For instance, you can get a home equity loan at a rate of 7.911% if you have a score between 720 and 850. But for the same loan amount, a consumer with a credit score between 640 and 659 may have to accept a rate of about 9.486%.
For a particular lender, a higher score will give you a low rate but if you consider a number of lenders, there's no guarantee as to whether you will get a low rate mortgage with a good score. This is because it is the lender who decides whether your score is "good" or "bad" and they differ in their standards of determining whether a score is better or worse.
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werty
Guest
0.10 Dollars($)
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| Posted: Fri Nov 04, 2005 3:29 am Post subject: Fico Score |
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| What is FICO score? |
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Samantha
Moderator
Joined: 16 Sep 2005
Posts: 1441
Location: MASSACHUSETTS
118.98 Dollars($)
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| Posted: Fri Nov 04, 2005 3:47 am Post subject: RE: |
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Hi Werty
Welcome to the MortgageFit Forums
A FICO score is a credit score developed by Fair Isaac Corporation. It is helps to determine the credit repaying ability of a credit user.
God Bless You,
Thanks,
Samantha |
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Richie
Guest
0.10 Dollars($)
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| Posted: Mon Nov 07, 2005 1:40 am Post subject: Is fico score the only credit score? |
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| can u pls tell me if there is any other credit score apart from the fico score? |
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Caron
Moderator
Joined: 19 Jul 2005
Posts: 1322
Location: florida
218.39 Dollars($)
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| Posted: Mon Nov 07, 2005 2:22 am Post subject: RE: |
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Hi Richie,
There is another credit score apart from the FICO score. This alternative credit score is based on a credit report offered by the PRBC Inc. under an agreement with the National Credit Report Association of the United States.
Homebuyers can now avail another credit score if their FICO scores are low enough to qualify for loans at affordable rates.
Know more about this score from the section on Alternative credit score
Hope you will benefit from the information.
Regards,
Caron. |
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