Credit scoring plays a vital role in a borrower's quest to qualify for a mortgage. It's becoming so pervasive that scores have even been analyzed in determining a consumer's approval for homeowner's insurance.
Virtually every lender uses the creditworthiness measuring tool FICO. The company that developed the mathematical equations used in determining the number is Fair Isaac Corporation. The three major credit history compiling agencies, Experian, TransUnion and Equifax, all use a Fair Isaac's formula - with their own brand name attached - to determine a potential borrower's credit risk.
Consumers curious about their FICO score can check out Myfico.com, which allows them to pull up their current information from all three bureaus for a fee.
This week, Fair Isaac announced a new information tool for consumers, FICO Saver For Homebuyers. The tool analyzes a potential borrower's credit score and details what the borrower should expect as a result in terms of interest rates and the loan handling process, the company statement said. The credit-score and information package will also offer customers information about their home-shopping locations and education on the lending process, according to the statement.
Housing industry players, including the National Associaton of Realtors, have voiced their support for consumers to have full access to credit information.
Congressman William "Lacy" Clay Jr., D-Missouri, intends to propose legislation which would give consumers access to not only their current score, but the four most recent occurences which have negatively altered the FICO, according to a draft of a recent speech.
Currently, consumers can obtain an Equifax and TransUnion score from the site, but Experian scores are unavailable, according to the MyFico.com FAQ page.