Understanding Credit Scores

Keyboard, wallet and cup of coffee

Understanding Credit Scores

Keyboard, wallet and cup of coffeeA credit score is a three-digit number that estimates how likely a borrower is to repay debt. Banks and lenders use credit scores as a factor when deciding whether or not they will approve an applicant for a credit card or a loan.

There are five major elements that are used to determine a credit score:

  • Payment history
  • Amounts owed
  • Length of credit history
  • New credit
  • Types of credit used

A FICO score is a well-known method used by credit agencies to decide the risk of a borrower. VantageScore is another method that was developed through a partnership between the three major credit bureaus: Equifax, Transunion and Experian.

Your credit score is one of your most valuable assets because it plays such a significant role in your eligibility to take out a loan, as well as the interest rate you will pay.

Fairway Fort Lauderdale is here to help you review your credit score and home financing options whenever you are ready. Our goal is to help you finance your dream home and provide you with the best customers service possible while doing so. Call us today!

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