How do lenders rate you on credit score and other factors?

Jessica

Mortgage lenders use a credit score in order to determine whether you can qualify for the loan. The score is based on the information that is provided on your credit report. This score is taken into account while charging the interest rate on your loan. And, if you can maintain your credit score, then you will be saving a huge sum in the interest.

Each and every lender sets his own criteria including the credit score required for approving mortgage loans. Lenders also consider the debt-to-income ratio while judging your financial strength of paying off the loan. Based on your credit score and debt-to-income ratio, lenders provide you with a credit rating that proves how creditworthy you are.

Rating	A	B	C	D	E
Credit Score	660 or higher	620 to 659	580 to 619	550 to 579	Below 550
Debt-to-Income Ratio	Lower than 35%	Around 50%	55% or higher	Around 60%	Around 65%
Late Payment
Mortgage	No late payment for past 2 years.	30 days late for once or twice in past 1 year.	30 days late for 3 to 4 times in past 1 year.	30 days late for 2 to 6 times and 60 days late for once or twice in past 1 year.	Late for 20, 60, 90 and/or 120 days.
Installment Loan	30 days late for once within past 2 years.	30 days late for 2 to 4 times during last 1 year.	30 days late for 4 to 6 times during past 1 year.	Few 90 and 120 days late payments since past 1 year.	Late for 20, 60, 90 and/or 120 days.
Revolving credit	30 or 60 days late for once in past 2 years.	30 days late for at least 2 times in last 1 year.	60 days late for 2 to 4 times in last 1 year.	Few 90 and 120 days late payments since past 1 year.	Late for 20, 60, 90 and/or 120 days.
Other Criteria	Good credit profile for last 5 years, no bankruptcy within the last 10 years.	No 60-day late payment. Discharged from bankruptcy 4 years ago.	Discharged from bankruptcy 2 years ago.	Discharged from bankruptcy within last 1 year.	Bankruptcy or foreclosure.

linkmanager1 · Joined: 09 Mar 2007 Posts: 22 13.66 Dollars($)

Thanks very much.Very good information provided here.

linkmanager1 · Joined: 09 Mar 2007 Posts: 22 13.66 Dollars($)

Can you provided more such articles?

Caron · Posted: Mon Mar 12, 2007 10:29 pm Post subject: RE:

Hi Linkmanager,

We have several articles on topics related to credit rating issues. What type of articles are you looking for? Please let me know.

Thanks,

Caron.

ligroy · Joined: 03 May 2007 Posts: 10 5.50 Dollars($)

im thinking maybe we should have a separate thread on people posting their credit score and sort of get an idea of where people are, and what they are doing about their score, i think that will be quite educational and helpful in some ways. Smile

great post, thanks Jessica Smile

colin · Posted: Fri May 04, 2007 1:09 pm Post subject:

Hi Ligroy,

Welcome to Mortgagefit forum.

jbarto65 · Joined: 04 Nov 2007 Posts: 522 8.43 Dollars($)

Awesome post, this is really good information to know, especially for those of us trying to rebuild credit.

Do you know where one can find a chart like this on how other lenders besides mortgage lenders rate your score?

fireyone_02 · Joined: 20 Mar 2008 Posts: 292 58.78 Dollars($)

This is definately great info. Its alot easier seeing spelled out the way you have. We just went through the mortgage thing. I see by your chart we scored a good B.

jbarto65 · Joined: 04 Nov 2007 Posts: 522 8.43 Dollars($)

That is awesome fireyone, was you able to get a better rate than on your initial mortgage? How long did it take you to get everything taken care of? We have a fixed rate and our advisor called and said that the rates have fallen, I don't want to go through the hassle of re doing all the paper work, we have a really descent rate, so I think that we will stay where we are for now.

fireyone_02 · Joined: 20 Mar 2008 Posts: 292 58.78 Dollars($)

We got a great rate.alittle over 5%. It took only a week. The adjuster came out a few days after we started the initial paperwork at the bank and a few days later we signed. It amy be worth your hassle...Remember a penny saved...

jbarto65 · Joined: 04 Nov 2007 Posts: 522 8.43 Dollars($)

Our mortgage is through a company that we have to go about 40 miles to deal with, so that is why I hesitate. I am trying to improve my credit score too, so I wanted to wait until I had a good years worth of not being late on anything before I tried again.

I can go through the VA for a descent rate if I keep everything in order and pay everything on time. I have a certificate to go to a lender, I was slacking on the bills there for a little while. I especially have to get the late mortgage payments off my record or show current, which I am doing now but it has not been a year, I may wait two before I consider redoing it.

I am glad that everything worked out for you, sounds like an awesome rate, great going.

fireyone_02 · Joined: 20 Mar 2008 Posts: 292 58.78 Dollars($)

You will get there too. It is sooo hard once you fall even a little behind..then it seems to take months to catch back up. You know what I mean?

jbarto65 · Joined: 04 Nov 2007 Posts: 522 8.43 Dollars($)

Yeah I know, I just hate starting over. LOL

fireyone_02 · Joined: 20 Mar 2008 Posts: 292 58.78 Dollars($)

There comes a point in life thast I think we all have to start over. Just don't look at it that way...Its not starting over, its just a second chance to go back and do it right. Inspirational aren't I? Probaly read that somewhere.

jbarto65 · Joined: 04 Nov 2007 Posts: 522 8.43 Dollars($)

I guess if you are getting a better intrest rate you can look at it that way, you said that you needed to consolidate bills all into one right? That is great for you. The last time we did our mortgage we did the consolidation and have only manage to get one more bill since then so it has worked out good for us, the only reason that I would have to re do the mortgage right now would be to get a better rate and ours is pretty descent right now, so I want to leave it alone for now. I am glad that it worked out for you.

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