Your Lake of the Ozarks Mortgage Lender: credit score fun facts

Friday, July 31, 2020

Tips for Building Your Credit Score

Your credit score will play a large role in getting your home loan, which means that paying attention to it and working to build it can be valuable. Your credit score will be used to determine your financial trustworthiness, and even if you aren’t thinking about buying a house right now, it can take time and planning to build it. Team Lasson has a few tips to help you make sure that you are working for the benefit of your credit score!

Watch Your Card Balances

One of the biggest things that you will want to watch is that you keep your credit card balances low. One of the major factors in determining your credit score is how much of that available credit you’re actually using. A good rule of thumb is the smaller the percentage the better, and an ideal percentage would be around 30% or lower. Another tip is to see if your credit card issuer will accept multiple payments throughout the month in order to get that statement balance down.

Consolidate Credit Card Debt

If you have multiple cards with small balances on each one, a good way that you can aim to improve your credit score is to get rid of those balances completely. An interesting factor that plays a role in determining your credit score is simply how many cards you have with balances.

Keep Your Credit Looking Strong

Two issues that can sink your credit or cause you to look risky are missing payments or suddenly paying less or charging more than you normally do. These actions can indicate risk in your accounts and could make it more challenging for your loan to go through. Essentially, you want every purchase to show that you are not going to be a risky investment and that you will pay the money back with timely payments.

Keep Accounts Open and Don’t Open New Ones

Did you know that closing unused credit cards will not raise your score? In fact, in most cases, it can cause your utilization rate to dramatically increase. On the other hand, you don’t want to open many new accounts while you are in the process of raising your credit score as this could reduce your utilization rate and backfire on you. Just keep a slow and steady pace and know that every step you take in the right direction will help get you there.

Pay Bills On Time

When planning to purchase a home at Lake of the Ozarks, you may be saving up money, but don’t let that savings spree delay your monthly expenses. It’s important to continue to pay your bills on time, as paying them after the due date can affect your credit score. Remember that even if you have a large sum of money in savings, a drop in your credit score due to not paying your bills on time could cause issues with your home purchase.

In general, building your credit score is about fixing errors in your credit history and then maintaining a consistent, good credit history from there on out. Raising your credit score will take patience and discipline, but it will all be worth it when you get to buy a dream home at Lake of the Ozarks. If you're thinking about applying for a home loan at Lake of the Ozarks anytime soon, contact me at 573-746-7211. As your Lake of the Ozarks mortgage lender, I'll work with you every step of the way!

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Michael Lasson

Senior Loan Officer

NMLS #: 493712

4655 B Osage Beach Parkway

Osage Beach, MO 65065

Direct: (573) 746-7211

Cell: (573) 216-7258

e-Fax: (866) 397-0318

Email: mlasson@fsbfinancial.com

Website: www.YourLakeLoan.com

**The postings on this site are my own and do not necessarily represent First State Bank of St Charles’s positions, strategies, or opinions.

Tuesday, January 31, 2017

13 Interesting Facts About Credit Scores

Credit scores are a common topic in the mortgage industry. In today's blog, your favorite mortgage lender at the Lake of the Ozarks offers a few interesting facts about credit scores. Keep reading to see if you've heard any of these fun facts before.

1. The widely used FICO (Fair Isaac Corporation) score is based on the work of engineer Bill Fair and mathematician Earl Isaac, who founded the firm in 1956. They developed the first credit bureau-based scoring system in the mid-1980s.

2. Credit scoring got a huge boost in 1995 when the U.S.’s two largest mortgage-finance agencies, Fannie Mae and Freddie Mac, recommended lenders use FICO credit scores. Their recommendation carried enormous weight in the home loan industry.

3. Some variation of the FICO score is used in 19 countries outside the U.S.

4. The “Great Recession” had a significant impact on the credit-scoring world. More people fell into the lower brackets: 25% had scores under 600 in October 2010, compared to 15% in 2006.

5. To get the highest possible credit scores, a person needs both revolving debts, such as credit cards, and installment debts, such as mortgages or auto loans.

6. The average American has 13 credit accounts showing on their credit report, including 9 credit cards and 4 installment loans.

7. Most Americans use less than 30% of their available credit limits. Only 1 in 6 uses 80% or more.

8. Maxing out credit cards damages credit scores by 10 to 45 points.

9. About half of Americans don’t have a single late payment on their credit reports. However, approximately 4 in 10 have been 60 days or more overdue in the past 7 years.

10. Over 144 million people, or 2/3 of American adults, haven’t looked at their credit report in the last year. Over 1/3 of Americans adults admit that they do not know their credit score.

11. There's an online dating service out there called CreditScoreDating.com for those that are concerned with the financial situation of their potential mate.

12. The Bangladesh-based Grameen Bank uses gender in its credit scoring model and mostly lends to women. As of December, 2015, the bank had 8.81 million borrowers, 97% of whom were women. To them, women are seen as more responsible borrowers than men.

13. More than 8 million people fall victim to identity theft in the U.S. each year. Consumers spend hundreds of millions of hours trying to resolve the problem, stop the fraud, and clear up their credit reports.

When it comes time to secure a mortgage at the Lake of the Ozarks, your credit score is an important factor. There are a number of programs available to help borrowers better their credit score. A solid credit score lends to more financing options when preparing to buy a home. For more information on how your Lake of the Ozarks mortgage lender can help you purchase your dream home, give me a call at 573-746-7211.