How Your Credit Score Affects Your Mortgage Loan Application
Having a good credit score is one of the most important elements in a mortgage loan application, and it can determine whether or not you will get approved. As a first time home buyer, the mortgage process can be daunting, and having a firm understanding of how your credit score works can make the process a little less scary. Academy Mortgage wants to make sure that everyone purchasing a home understands what a credit score is and how it can affect your chances of getting a loan for your new Atlanta home.
A credit score is a measure of how likely a borrower is too repay a debt. Credit scores range from 300 to 850, with 300 being a poor score and 850 being an excellent score. An individual’s credit score is derived from three credit repositories: Transunion, Experian and Equifax.
When you apply for a new home loan, the mortgage lender uses the middle credit score from the three credit reporting agencies to determine whether you will be able to repay the loan. Each agency assigns an individual their own credit score and each agency’s score may be different because a creditor may not report the information to all three of them.
It’s important to note that the credit reporting agencies use a very fair scoring module, as they don’t know your gender, age, race or zip code. The agencies do not know whether you are rich or poor, because the only information that they receive is what is reported in your individual credit file.
As you prepare to begin your search for a new home in Atlanta, it is important to make sure that you have reviewed your credit history to ensure that it is accurate. For more information on how your credit score can affect your new home loan, contact Academy Mortgage by calling 404-558-4399 or visit www.AcademyMortgage.com.
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