Page Title

CREDIT CHECK

<= span dir=3Dltr>1338 E. Perkins Ave. Suite 103 •= = Sandusky, Ohio 44870 &= #8226; Phone 419/625-2600 • Fax 419/621-1325 • www.thebriansmit= hg= roup.com

Before approving you for a home mortgage, it’s essential to = ensure that your credit report is accurate. A consumer’s credit= score is one of the most important factors in a lender’s decision to= approve or reject a mortgage application.

There are five factors that impact consumer credit scores. C= redit score factors (in order of weight/importance):

1. &nbs= p;PAYMENT HISTORY has a 35% impact. Payi= ng debt on time and in full has a positive

= impact, and late payments, judgments and charge-offs have a ne= gative impact.

2. &nbs= p;OUTSTANDING CREDIT BALANCES have a 30% impact. Debt ratio of outstanding

= balance to available credit is important. Keeping that b= elow 50% is wise and below 30% even wiser. It is never a good idea to= close an account; the debt ratio will go up and the number of seasoned lin= es will decrease. Pay outstanding debt down as close to zero as possi= ble and evenly redistribute the remaining balance among the open lines.&nbs= p; The increased interest incurred by moving a balance from a 0% card to a = 23% card will be minimal relative to what the increased mortgage debt might= be with a low credit score. Hitting the maximums of available credit= can be very negative. It may be worth calling and asking the credit = company to increase your available credit to lower the debt rat= io, provided they can do so without a hard credit inquiry.

3. &nbs= p;CREDIT HISTORY has a 15% impact. The = length of time a particular credit line has been opened is important. = A seasoned borrower is stronger

4. TYPE OF CREDIT has a 10% impact. A mi= x of auto loans, credit cards and mortgages is positive, rather than a conc= entration in credit cards only.

5. &nbs= p;INQUIRES have a 10% impact. Hard= inquiries for credit will negatively impact the score. Auto and mort= gage inquiries receive special treatment and 20 inquiries can be made in a = 14-day period for auto or mortgage and will be treated as only 1 inquiry.&n= bsp; The maximum number of inquiries that will redu= ce the score is 10. Any inquiries beyond the (11+) in a &n= bsp; six-month period will have no further impact on the = borrower. Each hard inquiry can cost 2-50 points on a credit score.

**Compiled from Edward B. Jamison’s presentation, “Let= ’s talk credit repair.” Mr. Jamison is a = ; nationally recognized expert in= Credit Remediation.

To request copies of your credit report, call each credit bureau l= isted (since more that one agency may have a file on you, some with differe= nt information). The three major national credit bureaus are.<= /p>

*EQUIFAX, P.O. BOX 740241, Atlanta, GA 30374-0241; (800) 685-1111<= /span>

*EXPERIAN (formerly TRW), P.O. BOX 2002, ALLEN, TX 75013; (888) 39= 7-3742

*TRANS UNION, P.O. BOX 1000, CHESTER, PA 19022 ; (800) 916 - 8800<= /span>