CREDIT SCORING homeownership

Transcription

1 the ultimate guide to CREDIT SCORING homeownership courtesy of shamrock financial 1

2 2

3 Table of Contents Credit Score Basics...4 Why are credit scores important for consumers?...5 What are the possible credit score ranges?...6 Fair and Accurate Credit Transactions Act...8 Factors Used to Calculate Your Credit Score...9 How Credit Scores Affect Mortgage Rates...11 Accessing Your Credit Score...13 The Mortgage Process & Credit Scores...19 What you should do during the mortgage process...20 What you shouldn t do during the mortgage process...21 Conclusion

4 Credit Score Basics Credit scoring has become an increasingly important topic in recent years, and for good reason. For a long time, the public associated the concept of credit scoring only with the desire to purchase highpriced items, such as a new car or a home. Today, credit scoring is used in many more arenas. For example, your credit score can affect if you get a good rate on your car insurance or cell phone. Your financial snapshot, as indicated by both your credit score and credit report, is used more and more by employers, especially those who want to hire people for positions of management or financial responsibility. Still, the basics apply - your credit has an effect on your ability to get a home loan. When your credit is bad or worse, you could have a lot of difficulty obtaining a mortgage, getting the amount you need, or qualifying for the interest rate that you can afford. Therefore, before you attempt to get or refinance a mortgage, you should understand what your credit score is, how it is calculated, and how you can be affected by it. WHAT IS A CREDIT SCORE AND CREDIT REPORT? Before you can determine if your credit score is any good, you need to know what both a credit score and credit report are. In short, your credit score is a number that indicates your ability to pay back mortgages, car loans, or other debt, also termed creditworthiness. Your credit report is a document that lists many of your financial accounts and transactions, your personal and demographic information, and employment details. Many people such as your mortgage lender - use your credit score and report to determine your creditworthiness. In terms of mortgages, your creditworthiness determines your eligibility to get a loan, the loan amount, and your interest rate. 4

5 WHY DO WE HAVE CREDIT SCORES? Before there were credit scores, how did mortgage lenders know if a person was a good credit risk? Mostly, they relied on lending experience and good judgement. But that process was time consuming to say the least. To assist mortgage lenders in the decision-making process, the first credit score model was implemented in the 1950s. Initially, it gave mortgage lenders the financial profiles of their clients who wanted a mortgage or wished to refinance. The lenders' biggest concern was whether the client could repay a loan, and establish the percentage of risk involved. But it has evolved since then - it is now a statistical model for understanding financial risk using a consumer s history to assess that risk, or more specifically, to quantify the probability that a consumer can make each mortgage payment on time. WHY ARE CREDIT SCORES IMPORTANT FOR CONSUMERS? Your credit score isn t just a piece of interesting information. As stated earlier, it can affect many aspects of your daily life, such as your ability to get a credit card, rent or purchase a home, obtain a decent insurance rate, or even gain employment! Additionally even if you are a good credit risk, if your credit score is based on information that is incorrect, out-of-date, or even just plain wrong, then you could be unknowingly and adversely affected. When shopping for a mortgage or wanting to refinance, your credit score will help determine how much you are allowed to borrow, the interest rate you get, any special offers or discounts, among other aspects. That's why it's important to know your credit score before applying for that mortgage. You should note that about 18% of people in the United States have a credit score above 800. Over half of consumers in the United States have scores over 700. However, due to having a score below 600, nearly one out of five potential home buyers may not qualify for the home loan or the refinancing that they want. Therefore, knowing your score before applying for a home loan or refinancing is the first step to getting your financial house in order and avoiding home buying disappointment. 5

6 What are the possible credit score ranges? Everyone with credit will have a credit score. Even if you know your credit score, do you know how it could impact you? Specifically, here are the FICO credit score ranges and what they mean to you: : Very bad credit. You can t get a mortgage, car loan, or even a credit card : Bad credit. Obtaining a mortgage is unlikely and would require more than the minimum down payment. Getting a car loan may be possible but at much higher rates : Injured credit. Low down payment mortgage possibilities begin here though many people may still find it difficult to qualify in this credit range. For car loans, rates are still going to be near the highest : Somewhat precarious credit. Again, mortgages are possible if you meet the more stringent requirements but conventional financing is still out of reach for the lower half in this category. While you may avoid the worst rates for car loans and in some cases get conventional vehicle financing, you will likely get it from a car dealer and not through a bank. Credit cards will have higher interest rates and low credit limits. 6

7 : Below Average credit. You may obtain a traditional car loan or credit card but with terms that are still worse than average. You may be eligible for either a conventional or government backed mortgage, but again, with higher interest rates and potentially more stringent terms : Average credit. The average credit score in the U.S. has climbed to 700 for the first time ever. You can get any type of mortgage, credit card, or car loan at a decent (though likely still not the best) rates. Things are looking up! : Very good credit. You can negotiate for a better rate on your mortgage, credit card, and car loan : Great credit. Because you are a very low credit risk, you can get the best rates and possibly some discounts or special offers too. 760 and higher: Excellent credit. You are considered the lowest risk and will get the lowest rates and discounts on other items (like mortgage insurance, if needed). 7

8 Fair and Accurate Credit Transactions Act Because your credit score can have such a strong impact on your financial life, how do you know if your score is being calculated correctly and objectively? In 1971, Congress passed the Fair and Accurate Credit Transactions Act (FACTA) to establish guidelines for fair practices regarding the use of credit scoring. Specifically, FACTA was created to promote accuracy in credit reporting and protect the privacy of consumers. But with the ever increasing and growing use of credit scoring, plus a mounting rate of identity theft, recent legislation provides more protection and consumer awareness to Americans. Under FACTA, this means: You can view your credit report for free once every 12 months from any of the following Credit Reporting Agencies (CRA) Equifax, Experian, and TransUnion through the central website You can purchase your credit score after you have viewed your free credit report from any of the CRAs mentioned above. It is always recommended that you order your credit score and credit report at the same time to have a complete picture of where you stand with your credit. 8

9 Type of Credit 10% New Credit 10% Payment History 35% Credit History 15% YOUR CREDIT SCORE Outstanding Credit Card Balances 30% Factors Used to Calculate Your Credit Score If you know your credit score, then you may think that it is simply a number but this simple number can affect you in many ways, such as getting a home loan or obtaining refinancing. Therefore, understanding how this number is calculated can give you the knowledge you need to make the best financial decisions so that you can not only get a mortgage or refinancing, but qualify for the best terms possible. First of all, you should know that your credit score is comprised of five factors, and that your credit score increases or decreases by how well you achieve each factor. The higher the score, the more favorable you will be seen by mortgage lenders, credit card issuers, and others. The key to having a great credit score is to rank highly in as many factors as possible, and not just one or two. WHAT ARE THESE FACTORS? They are listed below in order of their importance in calculating your credit score: 1. Payment History: Comprises 35% of your credit score. Paying your debt on time and in full has the greatest positive impact on your credit score, and therefore on your ability to get that mortgage you want. Conversely, judgments, late payments, delinquencies, and charge-offs will affect it negatively. 9

10 2. Outstanding Credit Card Balances: Comprises 30% of your credit score. How much debt you carry on your credit cards will also affect your ability to get a loan or refinancing. This factor indicates the ratio between your outstanding balance and available credit. Ideally, you should keep every balance as close to zero as possible not only to avoid fees and penalties, but also to show to mortgage lenders that you can manage your finances. Furthermore, you should ensure that this ratio is far below 30% of your available credit limit at least 2-3 months before you start the process of purchasing a home or obtain refinancing. 3. Credit History: Comprises 15% of your credit score. Your credit history indicates how long it has been since you opened a particular credit line. This gives mortgage lenders an idea of how well you have historically addressed your finances, which in turn tells them how well you can make your mortgage payments. Keep in mind that someone just starting to obtain credit will have a shorter credit history than someone who has had credit for a longer time. If that is the case, make sure that the other factors are ranked highly to offset this one. 4. Type of Credit: Comprises 10% of your credit score. Variety is the key to this factor. Your credit score will be ranked higher if you have a combination of types of credit, such as car loans, credit cards, and mortgages, instead of a concentration of only one type, such as credit cards. Also, balance is important; for example, if you have credit cards, it is usually a good idea to have more than one but, how many is too many depends on your overall credit profile. 5. New Credit: Comprises 10% of your credit score. While some believe this is solely based on the number of credit inquiries, that is actually only a part of this section - how many new accounts you have, how long since you opened a new account, how many recent hard credit inquiries you have had, how long since the last inquiry and do you have good recent credit history following past payment problems. The actual credit inquiry doesn t factor into your score when your credit is pulled. Only PAST inquiries factor in and they represent a portion of this 10%. Also be aware that rate shopping for a mortgage, student loan or car loan is perfectly acceptable. When shopping for any of these, multiple credit inquiries from different lenders count as a single inquiry (during a short period of time usually 2 weeks). So, New Credit is only 10% of your credit score, an actual credit inquiry is only a portion of that 10% and you are allowed to shop for a mortgage without damaging your credit due to multiple inquiries in a 2-week period. Your ability to get a mortgage or refinance isn t just restricted to your income or the size of your down payment. All of your financial decisions both newer and older, home-related or not will affect the mortgage or refinancing you will be offered. 10

11 How Credit Scores Affect Mortgage Rates Your credit score can affect you in a variety of ways your ability to get a credit card, the interest rate you obtain, and even the possibility of gaining employment in certain organizations. Therefore, it s no wonder that your credit score will also affect the mortgage you may qualify for and the rate you will receive. Here are a few ways that low credit scores can cost you when it comes to getting a mortgage: ABILITY TO OWN A HOME Whether you have typically had a lower credit score, or were caught up in the mortgage meltdown, your credit score can also affect your ability to own a home. If you have a low credit score or have problems on your credit report, lenders may either deny you a mortgage completely or else penalize you with such an exorbitant rate that you can t afford a home after all. INTEREST RATE YOU RECEIVE Predictably, having a higher credit score means that you will receive a lower interest rate on your mortgage loan, and likely won t need a large down payment. You can use FICO s mortgage payment calculator (available from their website at to see how your credit score can affect your interest rate. For example, assume you have a 30-year fixed rate mortgage with a principal amount of $ 300,000. If you improve your credit score from 620 to 720, you could save $ 85,000 in interest over the life of the mortgage. Of course, interest rates are not just determined by your credit score but by other aspects too, such as the amount of equity in your home, or down payment. This is particularly the case in conventional loans backed by Fannie Mae or Freddie Mac. However, a lower credit score means that you will most likely be subject to a higher interest rate. This, in turn, means that you could end up paying nearly 50% more interest on a home or almost four times the amount of interest on a car loan compared to someone with a higher credit score. 11

12 HIGHER PRIVATE MORTGAGE INSURANCE (PMI) COSTS Private Mortgage Insurance (PMI) is a fee that mortgage lenders charge most homebuyers who have a down payment of less than 20% of the total home price. If you have a lower credit score, then your PMI rate could be hundreds of dollars more per month than you anticipated. Although you can obtain PMI with a FICO score as low as 620, it is very expensive so you may have a harder time qualifying and the home will be much less affordable. ABILITY TO REFINANCE As you build equity in your home, you may eventually think about borrowing against that equity for a variety of reasons - home improvement or renovation, debt consolidation, or college tuition. However, a lower credit score will not only affect your ability to obtain a Home Equity Line of Credit (HELOC), but could result in a higher interest rate and other upfront costs even if you are approved. Having a lower credit score doesn t just affect your eligibility to get a home loan, but many other areas related to home ownership that may not be apparent at first, and these could mean hundreds in additional costs. Therefore, knowing your credit score before diving into the home buying process can save you money in both the short- and long-term. 12

13 Your Credit Report Accessing Your Credit Score WHY ACCESS IT? These days, you can get information about your credit almost whenever you want it, which is great for consumers. By accessing both your credit score and report, you can see what mortgage lenders, credit card issuers, and even some employers see when they look at your credit report. Accessing your credit report lets you go straight to the source of your credit data to see what is being reported about you. This includes your accounts, credit history, as well as your employment and demographic information. You can also keep an eye on your financial details, and correct those that are wrong, missing, or outof-date. For these reasons, it is extremely important to assume responsibility for the accuracy of your credit details, especially when you are in the process of or even just thinking about buying a home or refinancing your existing one for better terms. CONSIDERATIONS ABOUT ACCESSING YOUR CREDIT REPORT To start, you need to obtain a copy of both your credit report and credit score from any or all of the three major Credit Reporting Agencies (CRAs) listed on the next page. Because they do not share data, you should get your report from each of them to ensure that there aren't any incorrect details or missing information anywhere. By law, each CRA must give you a free copy of your credit report once every 12 months upon request. You may need to pay for additional requests within that twelve month span. For more information, visit the Federal Trade Commission's website at Because the calculation is proprietary, you will always be charged for your credit score. 13

14 What score are you looking at? Be sure that you are ordering an actual FICO score. Many services offer free credit scores but, unless you are actually purchasing a FICO score, what you see may be completely different from what your lender sees. Even the three major Credit Reporting Agencies have their own proprietary credit scoring models, which differ from FICO, and they are more than willing to sell you that score as opposed to a FICO score - so know what you are ordering when you ask for your credit score. Many credit cards are now offering a free look at your FICO score each month. While these scores may be more accurate than non-fico credit scores, you need to be aware of two things. First, they are only showing you one of your three credit scores so you don t know if it is your high, low or middle score. Lenders do not average your score. They utilize the middle credit score so you need to know what all three scores are to get an accurate picture. Second, even FICO has variations in their scoring models. FICO has been around for decades and has gone through many changes. The most recent FICO scoring model is Model 9 but mortgage lenders utilize older scoring models which have been proven over time (Fico Models 2, 4 and 5 depending on the credit bureau being used). So, without knowing which score model you are looking at, you won t know if it will be the same score that a mortgage company will get. CREDIT REPORTING AGENCIES You can order your credit report (for free) and credit score (for a fee) from the CRAs by mail, telephone, or online: Call (888) or visit Call (800) or visit Call (800) or visit The cost to purchase your credit score will vary for each agency. You can also access your credit report from the Annual Credit Report site in the following ways: Telephone: to talk to a representative. Online: Visit Mail: Send a completed request form to: Annual Credit Report Request Service, Post Office Box , Atlanta, Georgia You can use the following link to download the form and instructions: To have a complete financial snapshot, especially when buying a home or refinancing, you should order your credit score and report. 14

15 How Underwriters Use Your Credit Report When buying a house, your mortgage lender, specifically an underwriter, will look at your credit score and credit report to see what information it contains. But what do they do with that information? Firstly, the underwriter will decide if you are a good financial risk or not and that is used to help determine whether or not you will get the loan you are applying for. Keep in mind that the underwriter will examine the scores from all three credit bureaus. Because the scores generally will not be exactly the same on the reports, the underwriter will typically use the middle score as a measure of the financial risk that you pose. Underwriters will also review your past credit history over the prior months. Therefore, when starting to think about buying a home, it is highly recommended that you review your credit report and increase your credit score as early in the process as possible, especially if you have any credit issues at all. Unfortunately, many people are not aware of the state of their credit until they apply for a mortgage or other large purchase. Thankfully, you don t have to be in that position. Accessing your credit score and report on a regular basis is the starting point for improving your financial well-being so that you can get the mortgage and rate you desire. ISSUES ON YOUR CREDIT REPORT Understanding the impact your credit score has regarding your ease of buying a home, and then getting a copy of your credit report, are wise actions to take. But taking control of your finances doesn t stop there. Like many aspects of life, errors can exist on your credit report which can affect your ability to purchase a home or refinance the one you already own. Here are some things you should note about credit report errors and what you can do about them to facilitate the home buying process even before it begins. 15

16 How Prevalent are Credit Report Errors? Given how widely credit reports are used in making financial decisions, you may think that they are virtually error-free. However, based on a 2004 study about credit scoring by the U.S. Public Interest Research Groups (USPIRGs), an amazing 79% of consumers credit reports contained errors. Specifically, this is what they found: 79% had mistakes overall. 25% had mistakes that were serious enough that consumers were denied credit - and that includes mortgages and refinancing. 54% had personal information that was either out-of-date, misspelled, belonged to someone else, or was otherwise inaccurate. 30% showed accounts that the consumer had closed, but were still incorrectly listed as being open. Although an incorrect address, for example, may not result in being denied a mortgage, the cumulative effect of incorrect items in all areas of your credit report could adversely affect your ability to get a home loan. Therefore, to make sure that your home buying process runs as smoothly as possible, you should report and correct errors as soon as you find them. To be fair, the credit reporting industry disputes this study but the potential for errors is serious enough that the FTC has been madated to conduct several long term studies which you can read more about at 16

17 REPORTING ERRORS Here is what you need to do to fix any errors you find on your credit report: 1. Make a copy of your report and indicate the items that are incorrect. Keep the original copy for your records. 2. Create a letter to the credit reporting agency that provided the report. In it, request that the incorrect item either be corrected or removed. Make sure you provide documentation when possible. 3. Create a letter to the creditor that reported the problem, especially if you are a victim of fraud or identity theft, to indicate a) that you are challenging an item, and b) state why the information is wrong or inaccurate. Again, provide documentation when possible. 4. Send your letter to the credit reporting agency via certified mail. It is recommended that you attach proof of your address to avoid any delays in their response. You should receive a response from the credit reporting agency within 30 to 45 days. If they have corrected the issue, they will send you a revised copy of your credit report, for free, so that you can verify that the change was made. An accurate credit report can also improve your credit score, and will go a long way toward helping you secure the mortgage and rate you want. REGISTERING FORMAL COMPLAINTS The credit reporting agency has 35 days to respond to your letter. If they do not, then do the following: 1. Send them a formal complaint letter indicating that, as per Section 611 of the Fair and Accurate Credit Reporting Act, they are required to respond within 30 days from the date they received your initial dispute. Also indicate that, as per Section 616 and 617 of the same act, they are responsible for any damages you encounter and that you will seek legal representation if needed. 2. Your complaint letter should contain both the original dispute letter and proof of the complaint's delivery. However, while an issue may have been examined by the bureau, this does not mean that it will necessarily have been corrected, removed, or updated. If you have provided sufficient relevant documentation that your assertion is both accurate and true, then under Section 611 of the Fair and Accurate Credit Reporting Act, you are required to ask for the item to be reinvestigated. You should do this within 5 days of receiving the outcome of their investigation. While you can repeat this as many times as you want, after three to four attempts, you should consider filing a complaint with the Federal Trade Commission (FTC) Consumer Response Center to add your case to a class action lawsuit against the agency that is reporting the inaccurate information. You can either access the FTC complaint wizard, at: Or send your letter to the following address: Federal Trade Commission Consumer Response Center 600 Pennsylvania Avenue NW, Washington, DC

18 CREDIT REPORT NOTATIONS There are situations when a disputed item cannot or will not be corrected or removed. In these cases, you have the right to record your specific details on your credit report. Your statement should be concise (100 words or less) indicating why you are challenging the selected item. This notation will be included in your credit report as long as the item in question remains on your report. Never assume that your credit report is correct - always verify. Details can change, and the only way to do that is by getting a copy of your report every year. Doing so will ensure that your financial details are correct, and will help you obtain a purchase mortgage or home refinancing much more easily. 18

19 The Mortgage Process & Credit Scores CREDIT SCORING You re excited about buying a home a new place to call your very own. You look forward to decorating it how you want, and definitely with some new touches, perhaps paint or maybe even some new furniture. But before you get too excited, you need to make sure that you can get a mortgage, which means understanding what happens during the loan process. Even when you have increased your credit score enough to qualify for a loan, what you do during the loan process can still affect your ability to get that loan. So what exactly does the loan process entail? WHAT HAPPENS DURING THE MORTGAGE PROCESS When you submit your mortgage application, the lender will run a credit report for the underwriter. Consequently, you should not do anything that could affect your credit score while your loan is being processed this includes making large purchases or opening new credit cards, especially since lenders will be monitoring your credit while your loan is in process and may even have to update your credit report a few days prior to closing. Therefore, if your credit scores have decreased, you applied for other credit cards, your credit balances increased or you opened any other new lines of credit, your total monthly debt payments may have increased as would your overall debt ratios which may affect your ability to qualify for the mortgage you were seeking. 19

20 What You Should Do During the Mortgage Process Obviously, you want your mortgage to close easily and without complications. To make sure this happens, here is what you should do during the loan process: Join a credit watch program: Such a program will help you monitor your credit when you first start looking for a home to the time when you close. Look for a business that uses a score range that closely approximates that of the lender (typically between ). They should also let you know if your credit score has changed. Note that viewing your own credit score and report will not affect your credit score, but you may need to pay a fee to do so. Keep within your credit limit on your credit cards: If you must charge anything to your credit cards, keep well under your limit, although it s best not to charge anything at all if you can help it. During the loan process, keep your credit card balances below 30% of their limit at all times. If you do want to pay down credit card balances, then do it for every credit card you have. This will bring your balance-to-credit limit ratio to the same level on each credit card. Pay your bills on time: Under FICO, even one payment that is late can cost you anywhere from points, and those lost points can take several months to recover. Therefore, always pay your bills on time and in full, especially before your mortgage closes. Maintain contact with your mortgage lender and other real estate professionals: If you are even the slightest bit unsure about an action you want to take, or you have questions, then ask. They can give you the guidance to make sure that your credit score and report remains intact while the loan process completes. 20

21 What You Shouldn t Do During the Mortgage Process With the list of what you should do, there will always be actions you shouldn t do during the mortgage process. They are listed below: Don t apply for any new credit: Remember, any time you apply for new credit, including any pre-approved credit card offers, your credit score will decrease, and that s the last thing you need before closing your mortgage. Even for just a single hard inquiry, you could lose between 1 and 15 points. While a few points may not seem like a big deal, mortgage rates generally change every 20 points so someone with a 700 FICO Score will usually get a better rate than someone with a 699 FICO score. You don t want your score to drop, even 1 point, during the home-buying process. Don t pay any outstanding charge-offs or collections that you have: While this action is generally a good idea, during the loan process it will decrease your credit score immediately because the date of last activity - which is the payment now becomes recent. If collections must be paid off in order to obtain the mortgage then arrange with the lender to have them paid off at closing. Don t consolidate debt onto 1 or 2 credit cards: When you do this, it will look like you have reached or are approaching your credit limit for the affected cards, and you will be penalized as a result. If you want to take advantage of lower interest rates by transferring balances, wait until after the loan process has completed successfully. 21

22 Don t close any of your accounts: Though closing an account you don t or rarely use may seem like a good idea, you shouldn t do it during the loan process. First, you will no longer have access to credit you may need, and it could appear that your debt ratio has increased, which could count against you. What s more, it could adversely affect other credit scoring factors such as your credit history. However, if you must close an account for your debt-toincome ratio, then plan for it. Don t let any of your accounts run past due: Even 1 day can make a difference when processing your loan application. But what if an account offers a grace period for payment? You may not be charged a fee but that late payment may show up as past due on your credit report. Any past due balances can decrease your credit score by more than 50 points. Be extra vigilant about paying in full and on time during the loan process. Items such as cell phone and medical bills that are unpaid and put into collections could reduce your score dramatically. Even a $5 collection can affect your credit score significantly. Don t dispute anything on your credit report: This may seem contradictory why have errors on your credit report? It s not just about accuracy but also timing, and the loan process is typically not the time to report errors. Your allegations will be noted in your credit report where an underwriter will see them. If that happens, mortgage lenders may not process your loan until the issue is either removed or addressed and your new credit scores are calculated. Don t do anything else that could be seen as an issue by the scoring system: Co-signing a loan or changing a name with a credit reporting agency don t do it. You want the least amount of activity on your credit report during the loan process. You could do these actions once the mortgage closes successfully. During the final stages of the mortgage process, you don t want to do anything that could adversely affect your ability to complete that process. Maintain the status quo, and when in doubt, ask. 22

23 Conclusion There are many aspects to your credit that can affect you in ways you never thought possible. Some issues may be quick and simple to fix yourself, while others may require more time or more professional guidance. CREDIT SERVICES The expertise of a credit improvement firm can be the best way to eradicate your credit challenges. Ask your mortgage lender for a list of reputable credit improvement firms that can help you improve your credit score and clean up your credit report. The Federal Trade Commission (FTC) regulates these credit repair services and provides free online information at to help you identify those businesses that don t have your best interests in mind. Finally, you may request a copy of the FTC free brochure Credit Repair: Self Help May Be Best that contains information about credit clinics. Write to: Federal Trade Commission 600 Pennsylvania Avenue NW Washington DC COMPLAINTS OR COMMENTS ABOUT CREDIT REPORTS AND CREDIT REMEDIATION SERVICES If you have any comments or complaints about your credit report, or questions about the credit remediation services you are using, you can address them to the FTC at the following address: Federal Trade Commission Consumer Response Center, Room Pennsylvania Avenue NW Washington DC FINANCIAL SUCCESS When obtaining a mortgage or refinancing seems like a distant dream, realize that it doesn t have to be. Knowledge and action two critical elements that help determine your financial success. Understanding what is contained in your credit report and how your credit score is calculated is the knowledge you need that launches the actions you need to take to improve your credit score and become financially savvy in all areas of your life. 23

24 homeownership Every mountain top is WITHIN REACH if you just keep climbing. Building your credit score to qualify for mortgage can feel like staring Mount Everest in the face. With hard work and determination, each small step forward brings you closer to your destination. I ve helped many clients make this climb and I am looking forward to helping you on your journey. If you have any questions along the way, feel free to contact me. For more information, call (401) or visit shamrockfinancial.com Corporate Headquarters 75 Newman Avenue, Rumford, RI (800) shamrockfinancial.com NMLS ID #2227 Rhode Island Licensed Broker and Lender: # LB, # LL; Florida Mortgage Lender: #CL ; Maine Supervised Lender: #SLM8104; Massachusetts Mortgage Broker and Mortgage Lender: #MC2227; Licensed by the New Hampshire Banking Department: #7688MB; Licensed Mortgage Banker New York State Department of Financial Services: LMBC NO ; Licensed by the Virginia State Corporation Commission: #MC-3964; Connecticut Correspondent Mortgage Lender # Shamrock Financial Corp.