Credit is the biggest factor in
the interest rate you receive and what type of loan you
get approved for. There are three official credit reporting
agencies that provide credit scores to lenders. They are
Equifax, Transunion and Experian. The middle score of the
three scores is what is used to rank your credit. Credit
scores are viewed by lenders in various ways but as a general
rule there are "credit tiers". If you have the
ability you should always strive to get to a higher tier
before obtaining a mortgage.
Credit Tiers are roughly:
How to fix your credit
Many people are in the dark about their credit, whether its their score or what factors affect their scores. It’s getting easier and easier to obtain the information you need to effectively manage and improve your score.
If you are considering purchasing or refinancing a home then obtaining a credit report on yourself and anyone else who is to be on the loan is an excellent idea. When you sign up online you don't log an inquiry and you can often obtain your report for free for 30 days on a "trial membership" basis.
Factors that impact your
credit score in order of significance:
Tips to help your score: