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The Impact of Credit on Mortgages

Your credit score has a very high impact on most mortgages. Prior to taking out a mortgage, get educated on your credit.


If your credit is below 740 & you are not eligible for a VHDA loan, look at ways to boost your score, depending on which lender you are working with. In some cases, lenders offer their max credit to those with scores 720 and above, while other lenders offer their max rates to those with scores of 740 and above. Don't be satisfied with 700; look at ways to boost your score so that you can save thousands or tens of thousands of dollars, felt in the short term and long term. By increasing your credit score, you not only save money, but qualify for more


If your credit is below 580, you usually won't be able to find a lender that will give you a mortgage until your credit rating is higher. There are some lenders that will go below 580, but you will typically need a larger downpayment if you go below 580, such as 10% or 20%. Some lenders have minimum scores of 620, & some have higher minimums. There is also 1 programs to buy where credit score is not considered, but they involve much more hassle than a typical program (it's a non-profit), take 3-6 months before preapproval typically, and aren't for the faint of heart.


Credit score is not the only factor in qualifying for a mortgage. The current debts you may be paying, the down payment that you can afford (if applicable), the income that you have, and your sources of income are all factors. There are also other factors like government programs such as down payment assistance grants (like the 3% down payment assistance grant with VHDA going on at the time of this writing), special tax incentives like the current mortgage credit certificate of VHDA offering a tax cut of 20% of your interest paid yearly at the time of this writing, or interest rate reduction programs like the roughly 1% rates that some get with USDA direct loans in places like Smithfield, Gloucester, and parts of York and James City County. 

Get Educated On Your Credit
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Get Your Free Full Annual Report

If you want to start building your credit, it's helpful to know what your credit scores are. You don't need to pay for this service. You can contact each credit bureau for a free report each year. If you do it this way, it's best to spread out the requests, pulling from one credit bureau first (such as TransUnion), pulling from another credit bureau in 4 months (such as Equifax), and pulling from another credit bureau third (such as Experian). Don't worry about damaging your credit score when you are checking your own credit, as it is only a "soft pull" on your credit score. From this source you will find more accurate scores than any other outside the bureaus since Annual Credit Report pulls directly from the bureaus. You can do it all here


To get scoring information & credit data more often, register on a paid website or free websites that tells you  your scores for free:

Free Credit Score Options

Free credit score options:


Short Term Options:

1 Month Free trial I recommend if going a free trial route or looking to get all 3 scores in 1 place initially without as high concern about long term scores:

Extra Credit by (multiple versions of all 3 scores - score on top right tends to be closest to mortgage credit score)

Credit Check Total provides a $1 trial that includes Fico 8 version of all 3 scores at the time of this writing. If you used Extra Credit's free trial months or >1 year ago and need updated scores with no means of getting 1 or all below, it's a decent option as long as you cancel in the trial period (7 days at the time of this writing).

Long Term Options:


DCU - checking +credit card (both, not either unless you receive direct deposits into your checking) - Equifax Classic Risk Score 2008 (EQ-08).

Huntington Bank (if credit card holder)

Langley Federal (if bank account holder)

Navy Federal (if account holder)

Penfed (if bank account holder)

Experian scores:

Chase if you have the Chase Slate free account (the best Experian option, though every time you sign in they like to ask you if you want to "upgrade" though, which is a paid upgrade) (if you're an account holder)


Bank of America (if you're an account holder)

Barclays (if you're an account holder)

Discover (if you're an account holder of Discover It or Discover More)

Partners 1st - bank account holders

Walmart Discover card or Walmart credit card

While the information can be good on the following sites, avoid paying much attention to the score on the following though the information on the report can be valuable for helping improve scores:

1st Advantage Credit Union: Vantage Transunion

Amex (Vantage mostly though there are some examples of true FICO scores depending on the account)

Bayport Credit Union - Vantage Transunion

BB&T - Vantage Equifax

Capital One-Vantage Transunion

Chase - Vantage Experian (unless you have the Chase Slate)

Citi (Bankcard 900 max model - details) (VantageScore 3.0 Experian)

Creditkarma - Vantage Equifax/Transunion

First National Bank Omaha - Experian Bankcard Enhanced FICO score 2008 (EX-08 bankcard enhanced, range of 250-900)

Merrick Bank (Transunion 250-900) Transunion

Wallethub-Vantage Transunion

For more details on many of these options & additional options, see which was one of the top sources for the above.

The FICO scoring model is used by around 90% of lenders (I've also read that no mortgage lenders use the Vantage score). It will also give grades on the components of your credit score, and will include tips on how to fix each component.


If you'd prefer to do more than what you can do on your own, with help from me or lenders that can help your credit for free, let me know. I can refer you to a credit repair company that gives discounted rates to clients of Garrett Realty Partners, have other paid options with others, & other free options through non-profits and DIY approaches.

Build Your Credit & Check Your Scores

Getting help to Build Your Credit:

Since joining Greg Garrett Realty, I have learned a ton about credit. I include some links to free credit building resources below, however for the best free help in building your credit, contact me so that either I can help you with building your credit if you're looking to buy a house, or I can refer you to a lender who can help you build your credit in preparation for a home purchase. For additional free resources, as well as some paid options, click this link

More (source of many photos on this page) will give you your Equifax and TransUnion Vantage ballpark score, which isn't very helpful since so few lenders use it, despite the Vantage dogma being perpetuated. I still use it in addition to because it can sometimes give other insights for free that other resources will not. I do not like many of the recommendations on Creditkarma, since it looks like it's mostly from advertisers. I prefer building credit through over and using FICO scores that are closer to mortgage FICO scores from websites like and banks where I can get the free scores. To access some of the best aspects of Creditkarma beyond the home page, once you've signed up, check your credit reports here and credit factors here.

Below is an example Credit Factors Page:

While the top 3 categories in the above case are relatively accurate, I'd like to point out some CreditKarma problems with the bottom three. 

Age of Credit History: Creditkarma only uses your active accounts. They do not factor in your closed accounts, which do factor into your credit report, depending on when they were closed. The person with the above credit has a few more years average age of credit history than the 3.1 listed. He discovered his actual average age, which included some closed accounts, using also offers a more accurate average credit age, and is my recommended way of keeping track if you want to for free on a monthly basis. 

Total Accounts: An almost negligible factor with the Vantage score, and not a factor with the more relevant FICO score. Credit diversity is a factor, but too many accounts with a $1 balance can actually count negatively on your score vs most of your accounts having a $0 balance while you're still active with them.

Credit Inquiries: According to & other sources, inquiries are on your report for 2 years, but only count negatively toward your credit for one year. In the case of this category, gives a better indicator of your standing. See the same person's credit inquiry grade detailed here:

Rather than using Creditkarma to track your spending, I recommend Mint Bills. When using Mint Bills, I recommend not connecting your savings account to it, only checking accounts. This way, it's a one step rather than a 2 step approach to seeing what you owe with credit cards versus what you have in your checking accounts for this month's expenditures. Karma had too many missing expenditures that I didn't find with Mint (with some exceptions with my Chase Freedom card that had some issues, but they were clearly warned about and not random and undisclosed as in Creditkarma).

Be aware that sometimes the tips on credit reporting websites, such as credit cards to get, etc., are sometimes paid for by advertisers on the site. This can include loans that they recommend, refinancing options, etc. Lots of other online sources have biased reviews paid for by advertisers with these same sorts of companies.

For some good tips on credit, look for multiple sources, especially unbiased ones. I post some of my own credit tips, including credit card suggestions, on my Facebook business page. 


For ways to improve your credit score with credit cards, and to learn what to avoid, click on my page for it here. There you'll find statements I've made like the following:

While unpaid or late credit cards can have a negative impact on the home buying process by lowering someone's credit score, those unfamiliar with credit could also be negatively impacting their credit even if they always pay on time in full.


For more of what you need, click here to go to the Mortgage & Financial page, here for my Credit Cards page, & here for my "What do I Need to Buy a Home?" page. For a 62 page credit repair guide from Angle Financial, click here


Click here for "Even More on Credit & Finances."


For free full reports to better understand the general score directly from FICO, click "Understanding Your FICO Score" or "FICO Score FAQS."

See my Credit playlist here



Note: The content on this site is not provided by a bank or issuer. Opinions expressed here are author's alone, not those of a bank or issuer, and have not been reviewed, approved or otherwise endorsed by a bank or issuer. 

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