| If you have bad credit history and are looking to get a | | | | Thats right, with no money down. |
| home mortgage loan, then chances are you are going | | | | 640 - 700 You should be able to be approved for a |
| to need to know all about how the FICO credit scoring | | | | 125% home mortgage loan. |
| system works. | | | | 700+ You're in the drivers seat! You should be able to |
| FICO - Fair ISAAC & Company - is the leading | | | | get an excellent rate with excellent terms. |
| credit reporting agency that lenders turn to when it | | | | 3. FICO depends on each credit report, so before you |
| comes time to credit scoring your home loan | | | | apply for a home mortgage loan, if you have bad |
| mortgage application; so if you do have bad credit | | | | credit history, get a copy of your credit report and |
| history, these guys will know. | | | | make sure there is nothing on there that shouldn't be |
| The formula used by FICO cannot be disclosed | | | | there. If there is, get it changed before you apply for |
| because of a decision made by U.S. Congress. There | | | | the home mortgage loan. |
| are some things generally known about FICO which | | | | 4. Wait until after you have purchased or refinanced |
| that could help you understand why and how you can | | | | your home before you buy anything additional on |
| get approved: | | | | credit. More loans or higher balances can have a |
| 1. The higher your FICO score, the better chance you | | | | dramatic effect on your mortgage approval, |
| have of getting that home mortgage loan. Also, the | | | | regardless of whether or not you had over a 600 |
| higher your score, the more room you have to | | | | FICO score before you bought on credit. |
| negotiate a lower interest rate. | | | | 5. Remember, the FICO score is only a part of your |
| 2. If you have a FICO score lower than 500, there is | | | | home mortgage loan application, so if at first you don't |
| very little chance you'll be getting a mortgage home | | | | succeed in getting your home loan mortgage, don't |
| loan. | | | | give up. Some lenders may still be willing to lend to you! |
| That said, if you have a score of: | | | | People with bad credit often don't understand how the |
| 500 - 600 you should be able to get a home mortgage | | | | credit scoring system works. It is beneficial to find out |
| loan, provided you are willing to make a down | | | | more about it when looking to get a home loan with |
| payment. | | | | less than perfect credit to bad credit or when dealing |
| 600 - 640 You should get a 100% home loan financing. | | | | with sub prime mortgage lenders. |