Understanding Credit and your Credit Score
Think you’re ready to buy a home in Elgin? There’s nothing worse than finding out you have a low credit score when you go in for your home mortgage because it can do a lot of unexpected things. It can lower your chances of getting a reduced rate (APR), it can lower the amount a bank will approve you for and it can increase your payments above a comfortable level due to excessive high interest. Know your credit history by getting it checked before you go out to get your loan by filling out a brief survey here: http://articles.moneycentral.msn.com/Banking/your-credit-score.aspx
Here are Experian’s guidelines on Risk Factors on determining your credit score:
Low Risk (726 – 830): Lenders rest easier when they extend loans and credit to individuals with high Credit Scores. Plus, you may be able to save money by negotiating a lower interest rate or a better term on a new loan or credit card.
Low – Medium Risk (700 – 725): Lenders may be more willing to extend credit to individuals with Credit Scores in the low-to-medium risk range. In this range, you may get better-than-average rates and terms on new loans and credit cards.
Medium Risk (626 – 699): Lenders may still be willing to extend loans and credit to individuals with mid-range Credit Scores; however, you may only get average rates and terms.
Medium – High Risk (551 – 625): Lenders may be less willing to extend credit to individuals with Credit Scores in the medium-to-high risk range. In this range, you may not enjoy the best rates possible.
High Risk (330 – 550): Lenders may be wary about extending loans and credit to individuals with Credit Scores in the high-risk range. You may be denied credit, or pay higher rates.