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Hi,
I just took advantage of a Massachusetts law that allows a free
credit report once a year. Our report is clean and accurate but
they do not include the credit score, FICO. The FICO is $7.95
from Equifax. My only concern is that we haven't had a loan since
1995 which I paid off in a few months. We are planning on buying
a winter home when my wife retires in four years. With a clean
history is the FICO useful now? Ever?
Thanks,
Gary
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abby wrote:
> Hi,
>
> I just took advantage of a Massachusetts law that allows a free credit
> report once a year. Our report is clean and accurate but they do not
> include the credit score, FICO. The FICO is $7.95 from Equifax. My
> only concern is that we haven't had a loan since 1995 which I paid off
> in a few months. We are planning on buying a winter home when my wife
> retires in four years. With a clean history is the FICO useful now? Ever?
>
> Thanks,
> Gary
Credit report is good, but does not tell the whole story. One can have
no late payments, but have so little in the way of accounts that their
score isn't as high as they'd think. I recently wrote that WAMU offers
free access to one's FICO score on an ongoing basis for any of their
card holders. And the card has no fee. If getting a new card is not
attractive to you, just pay the $8, and get a peek at your score. If
it's not all it should be, you have 4 years to work on it.
Joe
www.blog.joetaxpayer.com
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Pay the $7.95.You will know for sure all your financial decisions were
right for all the years.Your FICO score is what creditors really look
at.If your FICO is good,I doubt they even bother going through your
credit report.Do it for "peace of mind"! It is a no brainer.
~Marty~
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On May 16, 12:22 pm, "abby" <a...@c...net> wrote:
The FICO is $7.95
> from Equifax. My only concern is that we haven't had a loan since
> 1995 which I paid off in a few months. We are planning on buying
> a winter home when my wife retires in four years. With a clean
> history is the FICO useful now? Ever?
If you NEVER use credit then you can igore your FICO. FICO is a
pretty good guess of how likely you are to pay back a loan. If the
lender is confident you will pay back the loan then he only needs to
charge you for the time value of money and a modest profit. If there
is significant question that you will pay back the loan then he needs
to charge for loss of principle even if it is only partial and spread
over many loans. This is going to cost you more money. If it is
likely you will not pay back, he has to charge you a lot.
Knowledge is power. If you don't know your FICO and the loan officer
does, he can bluff you into accepting terms higher than you need to.
Car dealers do this (packing) all the time. Practically the first
question a lender will have will be about your FICO. It only makes
sense that you know what it is.
Sounds like you have lived a decent life. Why not get the benefit?
--------------------------------------
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In article <VOkXj.25$705.10@newsfe07.lga>,
"abby" <a...@c...net> wrote:
> I just took advantage of a Massachusetts law that allows a free
> credit report once a year. Our report is clean and accurate but
> they do not include the credit score, FICO. The FICO is $7.95
> from Equifax. My only concern is that we haven't had a loan since
> 1995 which I paid off in a few months. We are planning on buying
> a winter home when my wife retires in four years. With a clean
> history is the FICO useful now? Ever?
Don't worry about FICO. All that tells a lender is how profitable
you will be, so they know how badly they can take advantage of you.
You have been living just fine for years without knowing your FICO
score, so don't waste the $8 to find out. It doesn't matter. When
you go for a loan, you may find lenders that worship at the god of
FICO. And then there are better lenders that do manual underwriting.
Those are the ones that you want to deal with. They will evaluate
your history and give you a rate based on how well you have behaved.
-john-
--
====================================================
==================
John A. Weeks III 612-720-2854 j...@j...com
Newave Communications http://www.johnweeks.com
====================================================
==================
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John A. Weeks III wrote:
> Don't worry about FICO. All that tells a lender is how profitable
> you will be, so they know how badly they can take advantage of you.
> You have been living just fine for years without knowing your FICO
> score, so don't waste the $8 to find out. It doesn't matter. When
> you go for a loan, you may find lenders that worship at the god of
> FICO. And then there are better lenders that do manual underwriting.
> Those are the ones that you want to deal with. They will evaluate
> your history and give you a rate based on how well you have behaved.
Can you actually ask a bank if they are FICO-driven or if they'll look
strictly at your record (credit report, income, etc.) only?
I find this response curious, similar to the reply to the refinancing OP
who someone told not to bother calling the bank holding the current
mortgage. $8 seems a small sum to waste, the resulting knowledge may be
pretty valuable.
Joe
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"abby" <a...@c...net> wrote
> I just took advantage of a Massachusetts law that allows a
> free credit report once a year.
Federal law now requires that each legal U.S. resident be
allowed "one free copy of his or her credit report from each
credit reporting agency once every twelve months. This
information is available at the only government-sanctioned
credit reporting agency-operated website,
annualcreditreport.com, by calling 1-877-322-8228, or by
mailing the Annual Credit Report Request Form." (From
Wikipedia)
> Our report is clean and accurate but they do not include
> the credit score, FICO. The FICO is $7.95 from Equifax.
> My only concern is that we haven't had a loan since 1995
> which I paid off in a few months. We are planning on
> buying a winter home when my wife retires in four years.
> With a clean history is the FICO useful now? Ever?
I am going to assume that you plan on putting at least 20%
down on this second home. I just wouldn't feel good making
suggestions to a stranger, whose financial situation is
almost unknown, here unless you plan on this.
I think knowing your FICO or its approximate value would be
useful to you right now, if only to help educate you and
yours on the loan process today. Googling for {"automated
underwriting" "percent of lenders"} turns up reports that
somewhere around 90% of lenders today use automated
underwriting which very likely means FICO is a large part of
the input to the decision-making process. Myfico.com itself
states that 90% of the "largest U.S. banks" use FICO. The
automated-FICO approach is said to be less expensive to
lenders, and it cannot discriminate by race or gender. I
have yet to find reports that lenders that use manual
underwriting are somehow superior, except maybe in very
unusual cases. I doubt that banks that use manual
underwriting always offer lower mortgage interest rates. I
think it may be just the opposite, based on reading about
manual underwriting today. I would welcome citations from
others, either way.
I would do three things now:
1.
Try the estimator at
http://www.myfico.com/FICOCreditScoreEstimator/Defau
lt.aspx
2.
Read further about what determines the FICO score at
http://en.wikipedia.org/wiki/FICO_score#Makeup_of_th
e_credit_score .
Also read more at myfico.com and at sites found by googling
about what sort of credit score range is necessary for the
best interest rates. Off the top of my head, I believe
anything higher than 750 or so will get you the best rate.
3.
Make sure you can afford this house. Not to be presumptuous,
but a flag went up when you indicated that one of you was
retiring and yet planned to seek a mortgage for another
house.
It sounds like you'll be fine, but why not get more definite
peace of mind using the tools above?
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In article <o...@c...com>,
joetaxpayer <j...@n...com> wrote:
> John A. Weeks III wrote:
> > Don't worry about FICO. All that tells a lender is how profitable
> > you will be, so they know how badly they can take advantage of you.
> > You have been living just fine for years without knowing your FICO
> > score, so don't waste the $8 to find out. It doesn't matter. When
> > you go for a loan, you may find lenders that worship at the god of
> > FICO. And then there are better lenders that do manual underwriting.
> > Those are the ones that you want to deal with. They will evaluate
> > your history and give you a rate based on how well you have behaved.
>
> Can you actually ask a bank if they are FICO-driven or if they'll look
> strictly at your record (credit report, income, etc.) only?
> I find this response curious, similar to the reply to the refinancing OP
> who someone told not to bother calling the bank holding the current
> mortgage. $8 seems a small sum to waste, the resulting knowledge may be
> pretty valuable.
> Joe
That is just it...wasting money, no matter how much, is not a wealth
building strategy.
And how would the FICO score matter at this time. Will the OP say,
"hey, my score is really good, so I'll make 2 late payments?" If
the OP has been behaving, the score will be good enough. If they
haven't been behaving, then they may not get the loan. In any
case, with a loan pending in the near future, the OP is going to
want to behave well and not make any late payments. Knowing the
exact score shouldn't change their behavior, and if their behavior
doesn't change, then they don't really have a need for the score.
Save the money, even if it is only $8.
-john-
--
====================================================
==================
John A. Weeks III 612-720-2854 j...@j...com
Newave Communications http://www.johnweeks.com
====================================================
==================
--------------------------------------
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On May 16, 2:45 pm, joetaxpayer <j...@n...com> wrote:
> I recently wrote that WAMU offers
> free access to one's FICO score on an ongoing basis for any of their
> card holders.
What do you mean by "card"? Credit card? ATM? or just any checking/
savings account?
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bucky3 wrote:
> On May 16, 2:45 pm, joetaxpayer <j...@n...com> wrote:
>
>>I recently wrote that WAMU offers
>>free access to one's FICO score on an ongoing basis for any of their
>>card holders.
>
>
> What do you mean by "card"? Credit card? ATM? or just any checking/
> savings account?
Sorry I wasn't clear. A credit card. Don't know the APR (as I never
carry a balance) but there is no annual fee.
Joe
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