Credit Scoring

Before deciding on what terms they will offer you a loan (which they base on their risk), lenders want to discover two things about you: whether you can pay back the loan, and your willingness to repay the loan. To assess your ability to repay, they assess your debt-to-income ratio. To assess your willingness to repay, they use your credit score.

The most commonly used credit scores are FICO scores, which Fair Isaac & Company, a financial analytics agency, developed. Your FICO score ranges from 350 (high risk) to 850 (low risk). For details on FICO, read more here.

Your credit score comes from your repayment history. They don't take into account income, savings, down payment amount, or factors like gender, ethnicity, national origin or marital status. These scores were invented specifically for this reason. Credit scoring was developed as a way to consider solely that which was relevant to a borrower's willingness to pay back the lender.

Your current debt load, past late payments, length of your credit history, and other factors are considered. Your score is calculated from the good and the bad of your credit report. Late payments will lower your credit score, but consistently making future payments on time will improve your score.

To get a credit score, borrowers must have an active credit account with a payment history of six months. This payment history ensures that there is enough information in your report to build an accurate score. Should you not meet the criteria for getting a credit score, you may need to work on a credit history prior to applying for a mortgage.

First Community Bank of Central Al. can answer questions about credit reports and many others. Call us: (334) 285-8850.

Basic Pre-Approval

Get the Best Mortgage Rate! Tell us a little about your current needs and we can use that information to match you with just the right loan.

Tell us about your loan needs.
How can we get in touch with you?
Tell us about your credit history.