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Fix your credit score before applying for a loan

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How to find the best deal when you are refinancing your home

Home Equity Loans and Lines of Credit?
What are your options for home equity loans and bank lines of credit

Home Buying: How’s Your Credit?
How improving your credit score can help you with your loan and mortgage

How my credit score will affect my mortgage?
How to go about improving your credit rating before making a large purchase

Should I buy or rent?
How to make the right decision regarding your home

Home Loan, how much can I afford to buy?
Easy steps to help you with buying your home

How to pick the right auto loan?
Should I take out a bank loan, lease, or buy?

Student Loans, all the options available to you?
Financing, government grants, parents, what to do?

Comparing Lenders, finding the loan for your needs?
What to look for in a lender?

Home Buying: How’s Your Credit?

You’re finally ready to take the plunge: to buy your own home. But wait! Before you even think about hitting that open house circuit, there are two critical steps that you really cannot skip. First, you need to sit down and make an honest determination of what you can really afford. Once you have done this, the second step is to get your financial house in order so that when the time is right and you’ve found that perfect house, you’ll be ready to approach mortgage lenders.

Credit scores: What’s the deal?
Your credit risk score is a critical part of getting your finances in order because it is one of the most important factors that lenders will use in evaluating your suitability as a customer. Simply put, your credit risk score is a number that gives a snapshot of your credit risk picture at a specific point in time. The score helps the lender decide, "If I give this person a loan or credit card, how likely is it that I'll get paid back on time?" The higher your score, the lower your risk to the lender, and the better your loan terms are likely to be.

FICO and what it means
Most lenders use the FICO score, developed by Fair, Isaac and Company. The FICO score is calculated by each of the three major credit reporting agencies (Equifax, Experian and TransUnion) from a mathematical formula that evaluates many types of information from your credit report. However, there are other credit bureaus that develop their own scoring methods, and many lenders use their own scores, which often incorporate credit bureaus' scores as well as other information about you.

FICO scores were only recently made available to consumers but they have become an essential part of personal credit management. Often when you purchase your FICO score not only will you receive the score itself, but also an explanation of it, what it means to a lender, ways to improve it, and a full credit report.

How do I tell if I have a good score?
FICO scores range from 300 to 850. It’s hard to say what a good score across the board is, since there really is no one minimum score that would be accepted by all lenders. In other words, every situation is different. That doesn’t help much, does it? Well, consider this as an example: A FICO score of 750 may qualify you for a platinum credit card, whereas a score of 675 may indicate that you are a better match for a standard card. Your lender may be able to give you guidance on what you need to qualify for a given credit product.