What you need to know about Lending and your FICO scores…

• With the onslaught of companies offering free credit score, consumers are being lead to believe that the credit score they receive for free is the same score a real estate lenders uses when deciding whether or not to issue credit. Most free credit scores are not the same FICO scores that lenders request.  As a consumer you can purchase the lender requested FICO scores from Equifax and Trans-Union, not Experian, on MyFico.com for $15.95 each. Even then however, the score may differ slightly from the one lenders use.

• While higher FICO scores do open doors to borrowers for lower rates and more favorable loan terms, a score of 800 or more does not necessarily make the consumer more attractive to lenders. Every 20 points on a credit score can mean a slightly lower mortgage rate or better car loan, but only up to the mid-700s. So consumers whose scores are in the 600s or low 700s have plenty of room for score fluctuation.

For more information about lenders see our Lending Blog

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