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The Truth Behind Your Credit Score


Don't let the common misconceptions of credit scores turn you away from purchasing a home or finding a mortgage lender that's right for you! Although your credit score is a driving force when determining a mortgage program and interest rates, there are other important factors that help mortgage bankers decide these. Below are some common credit score myths corrected.


MYTH #1: Bad credit scores can't go away.

Truth: Every individual is in charge of their own credit score and whether or not it improves. Everyone's situations are unique so there are many ways to improve your credit score such as paying your bills on time, staying under 30% of your credit limit and checking your score. By doing these things, you may be able to watch your score rise over time.


MYTH #2: Checking your credit will hurt your score.

Truth: There are many sites that allow you to view your credit score without being penalized, such as Credit Karma. Your credit score may be affected when a lender looks at it.


MYTH #3: The credit score you check is the same one your lender sees.

Truth: As a borrower, the credit score you see from myFICO, credit bureaus or Credit Karma are educational credit scores. The purpose of these are to give you a perspective on where your credit stands. The score you are able to see is not the actual credit score lenders will approve in your application.


MYTH #4: Closing unused credit cards improves your credit score.

Truth: It is common to think that having an unused open line of credit can hurt you, when in reality closing a line of credit in good standing may actually hurt more than keeping it open.


MYTH #5: Paying off your collections helps your credit score.

Truth: Paying off a collection amount does help your overall credit story, but it does not immediately improve your score. Once a bill goes to collections, it appears on your report until the reporting time limit ends.


MYTH #6: Building good credit requires you to go into debt first.

Truth: You should never create more debt than you can comfortably afford. Using credit cards the right way along with time are the best ways to build strong credit.


MYTH #7: You won't be approved for anything with a bad credit score.

Truth: Having a bad credit score makes things more difficult in the loan approval process, but lenders don't only look at credit scores. Other factors that lenders examine are your income and level of current debt. Even with a higher credit score, you may still get approved for a loan, but the loan might come with the conditions of a higher interest rate or security deposit.



Don't let your credit score prevent you from purchasing your first or next home. There is always a way to rebuild you credit scores and different financing alternatives available. Remember to monitor your score and make smart purchases when beginning the home loan process!

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Summit Mortgage Corporation NMLS 3236. Information is not guaranteed and should be verified. Licensed in CA by the Department of Business Oversight. Loans will be arranged or made pursuant to the California Financing Law. Questions and concerns may be directed to support @go-summit.comNMLS Consumer Access www.nmlsconsumeraccess.org. Not all applicants will qualify. ClarkCountyLoanPro.com and LloydWhite.com is a division of Summit Mortgage Corporation. Lloyd White, Jr. is licensed to originate loans in ID/OR/WA/CA. Equal Housing Opportunity.

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