Jasz
VIP Contributor
Your credit score is a 3-digit number that is used to determine how you will be treated in the lending world. It's designed to help lenders assess your risk and help them decide whether or not they should extend you credit.
The more positive the information in your credit report, the better it is for your score.
Here are some of the top three unknown facts about foreclosure and your credit score:
1. Foreclosure can negatively impact your credit score even if you manage to pay off your loan on time.
2. Experian, Equifax and TransUnion each have their own way of calculating a person's FICO scores. They all focus on five different factors: payment history, types of debt owed, length of credit history, new credit accounts opened and types of accounts closed within two years.
3. All three bureaus take into account the age of your oldest accounts when calculating scores — so even if you've paid off all or most of your older debts, there could still be some negative marks on your report because those accounts were reported late or were opened too recently to qualify for the best rates offered by lenders at the time they were first opened (this can also affect scores).
The more positive the information in your credit report, the better it is for your score.
Here are some of the top three unknown facts about foreclosure and your credit score:
1. Foreclosure can negatively impact your credit score even if you manage to pay off your loan on time.
2. Experian, Equifax and TransUnion each have their own way of calculating a person's FICO scores. They all focus on five different factors: payment history, types of debt owed, length of credit history, new credit accounts opened and types of accounts closed within two years.
3. All three bureaus take into account the age of your oldest accounts when calculating scores — so even if you've paid off all or most of your older debts, there could still be some negative marks on your report because those accounts were reported late or were opened too recently to qualify for the best rates offered by lenders at the time they were first opened (this can also affect scores).
