First and Second Time Denver Homebuyers Need to Keep an Eye on Their FICO Score

Buyers often ask what a FICO score is and why it is important in the homebuying process. A FICO score, developed by Fair, Issac & Company, is a calculated score that determines a borrower’s likelihood of repaying a loan.  FICO scores are kept by three credit reporting agencies, Equifax, Experian and TransUnion. The data collected by these agencies is objective and based solely on factual data but if there are discrepencies in the data, it can be contested and corrected. Credit scores, which range from around 350 to 900, will determine everything from the pricing of your home loan to the rate you are quoted on your insurance. 

So, how exactly is your credit score determined? Your credit score is made up of payment history, outstanding debt, length of credit history, recent credit inquiries and number and types of accounts.  If you are looking to purchase a home and can put off buying a new car, it is a good idea to do so. Homeownership proves stability and credit worthiness while buying a new car may have the opposite effect. 

If you are a first or second time Denver homebuyer who like help in understanding the home loan process, we are here to help.  Please give a TeamCox member as we are more than happy to answer your questions regarding credit scores and about the general Denver real estate market.

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