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Valerie Bahm

Realtor®

Johnson Monroe

Gun Barrel City, TX

 

903-386-6064
Contact Me

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FICO® Score - a Brief Explanation

When you apply for a mortgage loan, you expect your lender to pull a credit report and look at whether you’ve made your payments on time. What you may not expect is that they seem to be more interested in your FICO® score.

“What’s a FICO® score?” is a common reaction.

Each time your credit report is pulled, it is run through a computer program with a built-in scorecard. Points are awarded or deducted based on certain items such as how long you have had credit cards, whether you make your payments on time, if your credit balances are near maximum, and assorted other variables. When the credit report prints in your lender’s office, the total score is displayed. Your score can be anywhere between the high 300’s and the low 850’s.

Lenders wanted to determine if there was any relationship between these credit scores and whether borrowers made their payments on time, so they did a study. The study showed that borrowers with scores above 680 almost always made their payments on time. Borrowers with scores below 600 seemed fairly certain to develop problems.

As a result, credit scoring became a more important factor in approving mortgage loans. Credit scores also made it easier to develop artificial intelligence computer programs that could make a “yes” decision for loans that should obviously be approved. Nowadays, a computer and not a person may have actually approved your mortgage.

In short, lower credit scores require a more thorough review than higher scores. Often, mortgage lenders will not even consider a score below 600.

Some of the things that affect your FICO score are:

  • Delinquencies
  • Too many accounts opened within the last twelve months
  • Short credit history
  • Balances on revolving credit are near the maximum limits
  • Public records, such as tax liens, judgments, or bankruptcies
  • No recent credit card balances
  • Too many recent credit inquiries
  • Too few revolving accounts
  • Too many revolving accounts

FICO® actually stands for Fair Isaac and Company, which is the company used by the Experian (formerly TRW) credit bureau to calculate credit scores. Trans-Union and Equifax are two other credit bureaus who also provide credit scores.

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Valerie Bahm, REALTOR®
Gun Barrel City, TX 75156
Phone: 903-386-6064
Email: valeriebahm@gmail.com

Testimonials

Valerie is extremely knowledgeable about the value of lakefront property. She is minutes away to instantly being there for her clients. Valerie has not only become our Real Estate Expert, she has also become family! Gadi Wolf
In my opinion, Valerie is very capable and proactive. We are extremely thankful for her great customer service! Ezra Wang
Valerie was the BEST! She ALWAYS answered all of our questions. Most importantly she is VERY knowledgeable of Farm and Land properties. We would recommend her HIGHLY! Sheila Anderson & Mark McKay
"Everything went very well from the very first time that I spoke to Ms. Valerie Bahm. I found myself in a very desperate situation with the sickness of my father and needed to sell the property in order to seek certain assistance. Ms. Valerie followed through very thoroughly until the deal was closed. I am very pleased and appreciate the promptness. Thank you. "
 
Ricky Herrera

I have worked with Valerie on several occasions and have found her to be extremely informative and helpful. She is without a question very attentive to the smallest of details. I would recommend her to anyone in Henderson County for any real estate needs or transactions.

Five Stars!
John P. Brooks
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