A high FICO score represents a lower risk to the lender. Higher FICO scores equate to lower interest rates offered.

There are three credit bureaus that report their own score. Experian, Equifax and TransUnion. The lender will disregard the low and high of the three and use your middle score for qualification.

There are things you should and shouldn’t do that may affect your score:


• Do get a copy of your credit report and review it for errors. Once a year, you can get a copy from from all three bureaus. Any disputed information should be resolved and cleared on your report prior to applying for a home loan.

• Pay down revolving debts to 65% of their balance. The more credit available in relation to what you owe will increase your scores.

• Ask for credit limit increases to up your available credit. If you’ve maintained a good payment history, they may agree and be sure to inform them if your income has gone up.

• Age of credit factors into your score. Ask a family member or dear friend to add you as an authorized user on an account they’ve had for years, in good standing with a balance of 30% or less.


• Don’t apply for any new credit cards or open retail cards offering special promotions – Inquiries from companies checking your credit will lower your score.
• Don’t close any accounts. The age of your tradelines and available credit factor into your score.
• Don’t pay off old collection accounts. This will update the account to a recent negative event, as a “paid collection” and will negatively impact your score. In most instances, lenders will not condition for open collection accounts to be paid at closing.

Did you know there’s a big difference between a free credit score, and a FICO score? Visit our Mortgage Fico Score vs Free Credit Scores page to learn more.

Scot Presley - Presley Financial