“Understanding Your Credit Report”

You will be better able to secure a good loan for yourself if you can obtain a copy of your credit and understand it from the perspective of your lender. Below you will find a simple guide to understanding the information contained in all credit reports:

Reasons for Your Rating

There are three major credit bureaus, Experian, Equifax, and Transunion, each of whom will have a credit score for you. Each of those scores will be accompanied by a list of reasons that justify the score they give you. In order to improve your score with each lender, you will need to address those specific reasons.

Public Records

On every report there will be a list of public records. If you’ve had bankruptcies, foreclosures, tax liens, or major collections, they will be listed in this area. You will want to double-check the accuracy of this information, especially the dates of filings and discharges as those dates are critical to your loan approval. For major collections, you will also be able to find out who currently owns those accounts so that you can find out how much you owe and clear them up.

Trade Lines

You will find a listing of all your open, active, and closed accounts on your report as well. In this list you can get all the pertinent information about each account, such as your account balance, limit, monthly payment, and amount of late payments. You will want to look at all of the dates associated with each account and make sure that what your creditor is reporting to the credit bureaus is accurate.

Inquiries

Every time your credit is pulled by a prospective creditor, an entry will be logged on your credit report to indicate who requested your credit and when. You want to remember that excessive inquiries can be viewed as a negative by the credit bureaus and affect your overall score.

You should know that when applying for a mortgage loan, you will be graded based on the middle score of the three major bureaus. Also, when you apply for a mortgage with Public Home Mortgage, Inc., you will always get a free copy of your credit report. It is our hope that this information will help you better understand your credit profile, and therefore, you will be better equipped to affect it in a positive way. If you have any questions about what you’ve read here, or would like to get more information about any mortgage topic, feel free to call us toll free at 1-888-383-5363 or simply fill out the question box below. We will be glad to help you in any way we can. There is never any obligation, and there are no fees associated with simply answering your questions.