See How Credit Missteps Lower Your Credit Score

by Tom Tousignant

in Blog, Credit Scoring

The FICO Recipe

Charlotte Home Buyers can now see a ‘what If’ for their credit score based on some common credit problems or issues.  This credit score information is available from Fair Issac, the folks who invented the FICO score.

If you’ve ever wondered how your credit score would be affected by a missed payment or a maxed-out credit card, now you can use a look-up guide to assess the probable damage.

Max-Out A Credit Card

  • Starting score of 780 : 25-45 point drop
  • Starting score of 680 : 10-30 point drop

30-Day Delinquency

  • Starting score of 780 : 90-110 point drop
  • Starting score of 680 : 60-80 point drop

Foreclosure

  • Starting score of 780 : 140-160 point drop
  • Starting score of 680 : 85-105 point drop

Not surprisingly, the higher your starting score, the more each given difficulty can drop your FICO.  This is because credit scores are meant to predict the likelihood of a loan default. People with lower FICOs are already reflecting the effects of risky credit behavior.

Also worth noting that the above is just a guide — your scores may fall by more — or less — depending on your individual credit profile.  The number and type of credit accounts you hold, plus their respective payments and balances make up your complete credit history.

Read the complete report at myFICO.com.

Lower credit scores will cause a Charlotte Home Buyer to have a higher mortgage interest rate, or may even result in a home buyer not getting a loan approval.

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