What Makes Up My Credit Score?
If you’re thinking about buying a home, your credit score is one of the most important numbers in the process — but do you know what actually goes into it? Here’s a breakdown…
If you’re thinking about buying a home, your credit score is one of the most important numbers in the process — but do you know what actually goes into it?
Your score isn’t just a random number — it’s a snapshot of how you manage debt, and it directly affects your ability to qualify for a mortgage and the interest rate you receive.
Here’s a breakdown of the five key factors that make up your credit score:
Payment History – 35%
This is the biggest factor. Lenders want to know: Do you pay your bills on time? Late payments, collections, or charge-offs can significantly hurt your score.Amounts Owed – 30%
This looks at your overall debt and your credit utilization — how much of your available credit you're using. Try to keep credit card balances below 30% of their limits.
Length of Credit History – 15%
The longer your credit accounts have been open, the better. Lenders like to see a stable, established credit history.
Credit Mix – 10%
A healthy mix of credit types — like credit cards, auto loans, and student loans — shows that you can handle different kinds of debt responsibly.
New Credit – 10%
Opening too many new accounts or having lots of recent hard inquiries can temporarily lower your score, especially during the mortgage process.
Bottom line: Your credit score isn’t just about one thing — it’s a combination of your habits, balances, and how long you’ve been managing credit. Small improvements in these areas can make a big difference in your mortgage options.
Need help reviewing your credit before applying for a mortgage? I’d be happy to walk through it with you!
What is an Escrow Account and How Does it Work?
If you're buying a home or refinancing, you've probably heard the term “escrow account” — but what exactly is it, and why does it matter?
If you're buying a home or refinancing, you've probably heard the term “escrow account” — but what exactly is it, and why does it matter?
An escrow account is like a special savings account set up by your mortgage lender to help manage two important homeowner expenses: property taxes and homeowners insurance.
Here’s how it works:
You make one monthly mortgage payment that includes your loan principal, interest, and a portion for taxes and insurance.
The lender holds that tax and insurance portion in your escrow account.
When your taxes or insurance premiums are due, the lender pays them directly from the escrow account on your behalf.
Why use escrow?
✅ Convenience – No surprise bills for taxes or insurance; it’s all rolled into your monthly payment.
✅ On-time payments – Your lender makes sure nothing is missed, helping you avoid penalties.
✅ Lender requirement – Most lenders require escrow on loans with less than 20% down.
A note on escrow analysis:
Each year, your lender will review your escrow account to make sure you’re putting in enough (but not too much). If taxes or insurance increase, your monthly payment may go up to cover the shortage.
Bottom line: An escrow account helps keep you organized and on track — and for many homeowners, it’s a stress-free way to manage key housing expenses.
Need help understanding your current escrow setup or want to estimate your total monthly payment? Let’s connect — I’d love to walk you through it!
Understanding Your Credit Report & How It Relates to Qualifying for a Mortgage
Your credit report plays a major role in your ability to qualify for a mortgage — but many buyers aren’t totally clear on what’s in that report or how it affects their loan options.
Let’s break it down.
Your credit report plays a major role in your ability to qualify for a mortgage — but many buyers aren’t totally clear on what’s in that report or how it affects their loan options.
Let’s break it down.
🧾 What’s in a Credit Report?
A credit report is a detailed history of how you’ve handled debt. It includes:
Your credit accounts (credit cards, auto loans, student loans, etc.)
Payment history (on-time vs. late payments)
Credit inquiries
Credit utilization (how much you owe compared to your limits)
Derogatory marks (collections, charge-offs, bankruptcies)
These details combine to form your credit score, which helps lenders determine how risky or reliable you may be as a borrower.
🏡 Why It Matters for a Mortgage
Lenders use your credit report to evaluate:
Whether you qualify for a loan
What interest rate you’ll receive
Which loan programs you may be eligible for
In general, the higher your credit score and the cleaner your credit history, the more favorable your loan terms will be.
✅ What You Can Do
Check your credit early — ideally before you start house hunting.
Dispute errors — inaccuracies can drag your score down.
Pay down balances — especially on credit cards.
Avoid new credit during the loan process.
Bottom line: Your credit report is more than just a number — it tells your financial story. Let’s make sure your story sets you up for homeownership success.
Have questions about your credit or want help reviewing your report? I’m here for that — reach out any time!