About Credit

Many of you know that having good credit is the gateway to obtaining a mortgage and owning your first home. With the changes in the economy, your credit score and credit worthiness has changed too, and it may not be for the better.

Your credit score is a ranking of your credit worthiness (how well you make payments, manage your credit, etc.) compared to the rest of the United States at a specific point in time. Seeing how the economy is not what it once was, your credit score may not be as high as it once was.

For example, say you pay all your bills on time, pay down the balances on your credit cards, work on paying off some of your debts and don’t open new lines of credit; your score should be fairly high, probably within the 650 to 700+ range. Unfortunately, everyone else in America is not as on top of their game as you are. Some people are paying late, not paying debts at all and maxing out their credit cards. Other people’s credit choices are affecting your overall credit score when it comes time to rank you against the rest of the American population. Don’t get me wrong, your score is probably still pretty high, but not as high as it once was.

Bottom line: If you are managing your credit well, you’ll probably still qualify for a home, your score may just be slightly lower than you expected.