If your resolution is to get into a new home this year, it's important to understand your credit score. Your score is a vital piece of a lender's credit decision, influencing the credit that's made available to you and the terms that you're offered. So how is your credit score calculated? By using information from several pieces of data from your credit report, including types of credit, length, debt and payment history. Here's how credit scores break down for the general population:
Scores range from 300–850. The higher your score, the higher likelihood that you'll receive a great rate and keep some of that cash in your pocket. The importance of these categories can vary by person, but if you focus on managing your credit wisely, you'll be in good shape. For more information, take our free, online CreditSmart® training to learn about building and maintaining good credit.
Make sure to follow this series to get more information about getting into a new home this new year and visit My Home by Freddie Mac® for more on the importance of credit, including three tips to improve your score.
