In the wake of the credit crisis, lenders have become much, much more selective about whom they lend to. Here are some basic facts that will help potential borrowers understand what they face.
The measurement that most lenders use to assess applicants' credit risk is the 'FICO Score' developed by Fair Isaac Corp. The score ranges from 300 to 850.
There's not one FICO score. Buyers have three scores: one for each of the three credit bureaus which are Experian, TransUnion, and Equifax.
Each credit score is based on information the credit bureau keeps on file. Since credit bureaus don't share their data with one another, the three FICO scores may differ, sometimes by as much as 100 points.
The components of a FICO score are:
- Payment history: 35 percent
- Amounts owed: 30 percent
- Length of credit history: 15 percent
- New credit: 10 percent
- Types of credit used: 10 percent
A consumer with a 580 credit score might qualify under FHA requirements, but, generally, in order to qualify for a conventional loan, a borrower must have a credit score above 620 (generally) and above 720 for a loan at terms and rates most borrowers would consider the most desirable.
This is the first time that I actually have seen the breakdown percentage of a FICO Score Report and wanted to share 
it with you. So being on time with your payments turns out to be their #1 concern!
Advice in PDF Form for INCREASING your Fico score and what not to do to DECREASE it!
Budget Work Sheet and How to get your Finances in Order BEFORE you start looking for a home!
10 Things a Lender Needs from You
Glossary of Mortgage Terms All the 'lingo' you would ever need or hear! It even gives me a headache!
How a Buyers Agent can help you!
If you are looking to find or sell a home in the Northwest Suburbs, please feel free to contact Lyn Sims of RE/MAX Suburban at 847-230-7324. I can provide you with copious amounts of information on many areas.
H O L D O N -- I'll take you to my home search website www.LynSims.net for a direct up-to-the-minute MLS SEARCH! All the homes for sale are right here in one place!
Lyn Sims at RE/MAX SUBURBAN 
(847)230-7324.
Northwest Suburban Chicago Areas of Elk Grove Village, Hoffman Estates, Schaumburg, Roselle, Medinah, Itasca, Carol Stream, Bloomingdale, Elgin, South Elgin, Streamwood, Hanover Park, St. Charles.
© 2010 Lyn Sims
You are wright Lyn, people need to periodically review their credit reports especially with identity theft on the rise. They can also log on to www.annualcreditreport.com and receive free copies of their credit reports. This is a site sponsored by all 3 major credit bureaus to meet the mandate of the Fed.
Thanks Hans for the great site. Nice all 3 reports can be gotten from here!
Lynn, this is great advice. Credit scores are a total mystery to so many people,
Patricia: Just trying to inform the public, most people don't pay attention to it until they have a problem.