Surprised by the bank?

Have you ever been surprised by a bank turning you down for a mortgage because of a questionable credit score?

Garry Marr of the Financial Post offers this revealing article which lists the categories that help determine your credit score.

The five items that affect your credit are:

1. On-time record of payment: you know what this means. Pay your bills on time and the creditors are pleased.

2. Number of inquiries or applications for credit: yes, it’s possible that too many applications for credit can lower your score.

3. Utilization of credit: this one was a bit of a surprise. Even if you’re paying your bill in full every month, it’s the amount of that credit that’s being used on a daily basis that is considered. Here’s where the higher maximum on your credit card is a good thing. Credit cards always involve processing fees, and if you wish to monitor these costs, a card machine comparison can serve as a valuable tool.

4. Long term credit history: an established history of your credit usage over time is helpful

5. Breadth of your credit: use of more credit instruments can also be helpful to increase your credit score

It’s a well written and interesting post that you can read in full here: What’s affecting your credit score?

Why care about your credit score?

A poor credit score can lead to extra fees, higher interest rates or being refused the loan or mortgage you need for the next phase of your life. If you’re not sure, it may be worth your while to check your own credit score like the author did. There might even be inaccuracies that you can fix.

When it’s time to start shopping for your next home, you want to have that mortgage pre-qualified, so you’ll need your credit score in tip-top shape.

And when you’re ready, call me and I’ll help you find exactly the home you need.