So you want to own a house? What is credit

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Are you looking to buy a house, maybe a car? What’s your credit score? No idea? Thinking it should stay a secret? Confused on what credit is? Come to our free Mortgage University event!

What is credit?

Your credit history is a report that determines whether you are a trustworthy person. You may think you are honest, dependable, and trustworthy but this isn’t the 1920’s. Banks today rely on a score from the Fair Isaac Corporation or FICO.

A FICO Credit score measures risk. Having a poor FICO Credit score means you are risky, and bankers are always looking to minimize risk! The lower your score, the less likely the bank believes you will pay your loan back. While you may be an honest, dependable person to your friends and family, to the bank you are not. How will the bank recoup that added risk? With higher interest rates and possibly added fees.

Now, what is your credit score? If you don’t know you are allowed one free credit check every year by visiting A low score is could be caused by not paying credit cards on time, owing more than you can afford, not having an established credit history, and opening multiple lines of credit.

Here is a breakdown of scores and what it may mean to you.

300-549: Lenders view you as a very risky borrower. You have long odds of being approved for a loan.

550-649: You are still a risk. But with this score lenders will start approving you. You may have higher interest rates but you still can be approved and own a home.

650-699: This is the range most people will fall into.

700-749: This is an excellent range to try and stay in. If you can attain a credit score above 700, you should collect some of the best rates and be approved for almost all loans and credit cards.

750-850: This is showing off. A perfect score is 850 and hard to attain. If you are in this range, you are the least riskiest borrower and most likely to receive the best rates and best loans available.

Still confused on credit or maybe now you want to take the next step towards owning a home? Contact one of UCB’s Mortgage professionals! Ready to get pre-approved for a home? Visit here!

Ready for more? Read on!

Part 2: Establishing Credit