We all know we live in a computer driven society. But did you know that depending on how you have paid your mortgage, credit cards, auto loans, etc. in the past will determine what you can buy in the future. Having no debt with no credit scores can sometimes hender a consumer from purchasing a new home or refinancing an existing home. 

The 3 major credit reporting agencies, TransUnion, Equifax, and Experian, , each have a  formula for building a credit score. 

While Experian still calls its score "FICO", TransUnion calls its score "Beacon" and Equifax uses "Empirica." While the formulas vary, the differences aren't huge; each agency uses the following factors in calculating your score:

• Your Credit History - How long have you had credit?

• Payment History - Have you paid more than 30 days late, and how often?

• Balances on your Credit Cards - How many accounts do you have, and how much do you owe on them?

• Requests for Credit - How many times have you had your credit checked for a loan?

These factors are assigned weights based on the formula being used. The results are added up and distilled into a single number. Credit scores range from 300 to 800. Higher is always better. Most home buyers likely find their scores falling between 620 and 800.

Want to know more about credit scores?

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