Before lenders decide to give you a loan, they must know that you are willing and able to repay that loan. To figure out your ability to pay back the loan, lenders assess your debt-to-income ratio. To assess how willing you are to repay, they use your credit score.

Fair Isaac and Company calculated the first FICO score to help lenders assess creditworthiness. For details on FICO, read more here.

The minimum required FICO credit score for a conventional mortgage is 620, but very few buyers get approved with such low scores. In fact, 96% of approved buyers have a score of 650 or above.

Credit scores only assess the info in your credit reports. They never consider your income, savings, down payment amount, or factors like sex race, nationality or marital status. These scores were invented specifically for this reason. Credit scoring was developed as a way to consider only what was relevant to a borrower's likelihood to repay the lender.

Your current debt load, past late payments, length of your credit history, and other factors are considered. Your score is based on both the good and the bad in your credit history. Late payments count against you, but a consistent record of paying on time will improve it.

To get a credit score, you must have an active credit account with six months of payment history. This payment history ensures that there is sufficient information in your credit to calculate an accurate score. Some borrowers don't have a long enough credit history to get a credit score. They may need to build up credit history before they apply for a loan.

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What Is A Credit Score?