What you need to know about credit scores…
These days you can get credit scores just about anywhere. Banks, credit unions, charge card companies, and even the credit repositories themselves now offer them to their customers as a value-added service. These groups give away the scores for free, often in the hope that they can convince the consumer that adding one of their products will lead to a higher score over time.
Here is the problem, the score they provide often isn’t the score that the repositories provide to the lending industry! The Consumer Financial Protection Bureau (CFPB) just fined Experian $3 million for lying about the scores they provided and how lenders use these scores. According to the CFPB’s action, between at least 2012 and 2014, Experian falsely represented that the scores they marketed to consumers were the same used by lenders for credit decisions. Experian themselves knowingly provided a different scoring model to the lender.
Because more and more consumers are relying on this misinformation to judge their own qualifications, it’s been causing serious issues for many. Some potential home buyers have been encouraged by “free” score providers to add unnecessary credit accounts in an effort to boost a score that was already sufficient and frequently, they saw their credit score actually decrease! Lower credit scores don’t just affect those struggling to meet minimum loan program requirements, they may cause higher mortgage interest or property insurance rates for even those who are well-qualified.
So just what can you do to be properly prepared when you want to buy a home? The answer is simple – get the credit information directly from the lender who will be providing the loan. Nova’s Credit Services team is fully staffed by certified FICO experts who share guidance on the proper way to maintain or increase a credit score. There are no tricks or gimmicks and their advice is free as part of the service we provide at Nova. Remember, this isn’t a service that is exclusive to the credit challenged—well-qualified individuals can save money too.
When experience counts, think SMART, think Nova Home Loans!