Credit Score: Commonly Asked Questions

Understanding What This Number Means For You

Your credit score is an important piece of your financial profile, and understanding it is crucial. To help you get a handle on what your credit score means for you, here are the answers to commonly asked questions.

  • What Is A Credit Score? A credit score is a number assigned to you based on your credit report. It is a grade that you are given based on your past payment history, amount of debt, the length of time you have had credit, the amount of new credit you have recently opened, and the type of credit you carry.
  • What Is A Good Score? Scores range from 300 to 850. The higher your score is, the better your credit. Generally, a score of 740 or above will qualify you for the best rates. Fannie Mae requires a minimum of 620 to back a mortgage, while the Federal Housing Administration requires 580.
  • How Do I Check Mine? According to federal law, you can secure a free credit score once a year from Equifax, Experian, and TransUnion.
  • How Do Credit Scores Affect Home Buying? Your credit score will affect how much credit you can get and at what terms. If you have poor credit, you will likely end up paying more interest on your mortgage, or could even be denied a home loan altogether.
  • How Do I Repair It? First, spend some time with your credit report ensuring there are no erroneous items. Then, be diligent about paying your bills on time, minimizing your debt, and do not open new credit. Bear in mind, however, that it will take time for these changes to reflect in an improved credit score.

To get the home buying advice you deserve for your dream property, contact Stella Tsakonas. Serving Lafayette, Orinda, Moraga, Alamo, Walnut Creek, Danville, and all the communities in between, I am here to meet all of your Contra Costa real estate needs.