While the mortgage and default crisis continues to shape the economy, the FICO score is not regularly talked about. If a person reviewing the many of the current foreclosures would locate people with decent credit foreclosing.
These individuals many times received loans based only on their FICO score. The news frequently point to all a person was necessary to have in the past few years was a respectable FICO score. But currently the idea is different plus the use of the FICO score is being looked at.
To begin because several of these mortgages were based on FICO ratings only and a higher level of research by the creditor is now needed to get the mortgage. Thus, it is going to take several additional components such as: a down payment.
Second because countless defaults are by people who were thought to possess good credit, the bar might be hiked. Creditors many times group individuals into ranges of ratings and use this to determine approval and interest rate. The effect would be a good credit score would be much higher than it was in the past.
Also, the base score might be raised. Often the familiar cut off point for mortgages was the low 600’s. Above this point, a person might belive it would be granted, however it still didn’t assure it. Also, if you were below this range it usually would mean you are qualified for a below prime mortgage.
All these changes are happening today. The issue is where a person’s credit will stand after the crisis.