In today’s Q & A we will be talking about credit as part of the pre-qualification process in getting a loan. Your credit will show the lender how credible you are based upon your payment history, amount owed on accounts, length of credit history, new credit inquiries, and type of credit used.

Credit scores range between 350 and 850. The higher the score the better. There are three credit bureaus that report credit scores; these are Transunion, Equifax and Experian. Each bureau has different credit reporting. Usually the lender will look at the middle score, but all three will be analyzed.

Mortgage lenders usually require scores above 500 and scores that are below 680 are going to be charged a higher interest rate. Anything above 720 is considered excellent.

Each credit bureau will allow you to pull your credit for free one time per year. You can visit www.annualcreditreport.com and pull your credit report for free!

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