Credit Scores - What to know about them
Credit scores range between 200 and 850, with scores above 620 considered desirable for obtaining a mortgage.
The following factors affect your score:
Your payment history
Did you pay your credit card bills on time? Bankruptcy filing, liens, and collection activity also affect your history.
How much you owe and where
If you owe a great deal of money on numerous accounts, it can indicate that you are overextended. However, spreading debt among several accounts can help you avoid approaching the maximum on any individual credit line.
The length of your credit history
In general, the longer an account has been open, the better.
How much new credit you have
New credit – whether in the form of installment plans or new credit cards, is considered riskier, even if you pay down the debt promptly.
The types of credit you use
Generally, it’s desirable to have more than one type of credit – such as installment loans, credit cards, and a mortgage.
