Your credit report, as maintained by the three major credit bureaus,
is a brief snapshot of your financial status, and list those business,
banks, credit cards, etc., that have granted you credit in your recent
past. It also records the timeliness with which you've repaid those
obligations. Potential lenders will review your credit history to
see how you have handled credit in the past. The credit report is
your key to securing a mortgage at favorable interest rate. Unfortunately
for all of us, mistakes frequently occur in those reports, and are
sometimes sufficiently negative to dramatically alter your ability
to get a loan.
It's a good idea to check your report regularly, and especially a
few months prior to applying for a mortgage, for it sometimes takes
months to resolve errors in your credit report. Mortgage lenders use
the information in your report as well as your credit score to determine
whether or not they will grant a loan and at what interest rate the
loan will be. The credit score they use is called the FICO® score,
provided by the Fair Isaac Corporation. Yours should be in the high
700's in order to get the best interest rate. If it's not, it is possible
to raise your score by following the tips provided with credit reports.
But, don't try one of the companies that promotes being able to raise
scores. Most of what they offer is expensive, provides little help,
and is sometimes illegal.
The FICO® score is the one used by lenders. Other credit scores
offered by the credit bureaus will not reflect the same number. Don't
waste your money paying for one. You'll be offered an opportunity
to pay for your FICO® score when you request your free credit
report, and can get the real thing then.
The credit bureaus are required to furnish a free credit report-you'll
have to pay extra for the FICO score-once a year, and if it's been
less than a year since your last free report, you should purchase
one from all three companies prior to applying for a mortgage.
It's easy to go online for your free credit reports. The web address
This is the only address for the mandated free reports. Don't be confused
by other "free" offers. They are all selling something.
To request your free reports by phone, call: 877/322-8228.
The three major credit bureaus are:
P.O. Box 740123
Atlanta, GA 30374
475 Anton Blvd.
Costa Mesa, CA 92626
P.O. Box 7000
North Olmstead, OH 44070