| At one website researched for this article, it states | | | | change over time, depending on your conduct, how |
| that a person with a credit score of 500 to 600 will be | | | | your credit history and payment patterns change, and |
| able to get a "preferred loan" for a mortgage provided | | | | how credit scoring technologies change." |
| such person makes a down payment. However. | | | | It is said that a picture is worth a thousand words. That |
| Those with credit scores less than 500 are most likely | | | | statement is quite true in the universe of credit for a |
| out of luck. This is an example of credit scores and | | | | credit score is a snapshot of your creditworthiness at |
| their importance. This article will provide a general | | | | a given moment in time. Your credit score will tell |
| credit score explanation and a brief summary as to | | | | creditors whether or not you are a good risk and how |
| why credit scores are important. | | | | you will handle your account. As the government notes |
| Insight into credit scores is provided by the Fair Credit | | | | in the excerpt above, a credit score is important |
| Reporting Act which requires that mortgage | | | | because it will determine if you get credit and the |
| companies provide certain notices to consumers, | | | | interest rate you will pay. |
| including a statement that: | | | | To see how this works, take the example of |
| "The credit score is a computer generated summary | | | | someone purchasing a house with a low but |
| calculated at the time of the request and based on | | | | acceptable credit score. The person gets the loan with |
| information that a consumer reporting agency or lender | | | | a requirement of a down payment of 10 to 20 percent. |
| has on file. The scores are based on data about your | | | | On a $100,000 house, this translates into $10,000 to |
| credit history and payment patterns. Credit scores are | | | | $20,000.00. Additionally, the person will pay a higher |
| important because they are used to assist the lender | | | | interest rate which will result in a higher monthly |
| in determining whether you will obtain a loan. They may | | | | mortgage payment and thousands of dollars in |
| also be used to determine what interest rate you may | | | | additional interest over the life of the loan. |
| be offered on the mortgage. Credit scores can | | | | |