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What does it take to have a mortgage credit score?
Let’s talk about what it takes to have a mortgage credit score, not a “consumer credit score”, not a mortgage credit score. There’s a big difference. Only mortgage credit scores are recognized by the mortgage industry, which typically takes more credit history into consideration. There are a lot of misconceptions about what it takes to actually have a score. And there are only two requirements, and both of those requirements can be met by just one account.
Two Requirements to Achieve a Mortgage Credit Score
Those two requirements are having an account that is at least six months old and having at least one account that’s been reported by the lender during the past six months. If there’s just one credit card that’s six months old and the lender’s recently reported on it, they’re going to have a score on that mortgage credit, but it must be a qualifying account. For example, a child support record, external collection company account or utility record is not going to count. And as all things with credit scoring, there are always going to be special situations with different requirements – contact your lender for more information.
So that’s it. Those are the only two requirements.
Mortgage Credit Score Misconceptions
However, there are some misconceptions that it takes possibly two accounts, or maybe you’re wondering why they have an extensive credit report and you still don’t have a score. Which is a situation where there’s nothing reported during the past six months. The good news is CreditXpert Automated Plans (Wayfinder) is going to tell you exactly what it takes to have a score, and what you need to do if you need to have a better score. A lender will have access to the CreditXpert Automated Plans solution to find the perfect path to reach an applicant’s credit potential.
Related Credit Insights
Uncommon knowledge: Mortgage and consumer credit scores are quite different. What's different? How are each calculated? Why are there two scores?
Your credit card usage can make or break your mortgage loan approval. Lenders look not only at your credit score but also at your debt-to-income ratio, which includes the payments on your credit cards. So improper use of your credit cards could make it harder to get approved for a mortgage.