Bad credit home loans do not have to equal high interest or high payment home loans. At ENG, your loan depends on much more than your credit score or past payment history. Our custom lending services provide the most alternatives available to clients in unique situations.There are five factors that comprise the credit score. These are listed below in order of importance, just as an underwriter will look at the score: Payment History: 35% impact. Paying debt on time and in full has a positive impact. Late payments, judgments and charge-offs have a negative impact. Missing a high payment has a more severe impact than missing a low payment. Delinquencies that have occurred in the last two years carry more weight than older items. Outstanding Credit Balances: 30% impact. The ratio marking the difference between the outstanding balance and the available credit is important here. Ideally, the client should keep their balances below 10% of available credit limits. Credit History: 15% impact. This marks the length of time since a particular credit line was established. A seasoned borrower is stronger in this area. Type of Credit: 10% impact. A mix of auto loans, credit cards, and mortgages is more positive than a concentration of debt from credit cards only. Inquiries: 10% impact. This quantifies the number of inquiries that have been made on a consumer's credit history within a six-month period. Each hard inquiry can cost from 2 to 50 points on a credit score, but the maximum number of inquiries that will reduce the score is 10. In other words, 11 or more inquiries in a six-month period will have no further impact on the borrower's credit score.
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