Last week, I attended a seminar about Identity Theft. The speaker, Robert Siciliano a straight talking Bostoner, suggested locking your credit report as a way to protect yourself against one of the more common types of identity theft called "new account" identity theft. This type of theft happens when someone steals your information and uses it to open an account in your name. He also suggested that you check your credit often. You are entitled to a free credit report, every 12 months from each of the nationwide consumer credit reporting companies: Equifax, Experian and TransUnion. You may have heard that "pulling your credit" too many times will actually hurt your credit; this is not true if you are the one asking for the information. You can find more good stuff about credit at AnnualCreditReport.com. While on the subject of credit I asked guest blogger, George Souto, to share with us information about what makes up your credit score and how important having good credit is to obtaining a mortgage. 
One of the most important criteria in obtaining a Mortgage is having good credit. Your Credit Score will determine what Loan Program you qualify for, which in turn will also determine the interest rate you will receive. So it is very important for anyone who is considering buying a house in the future, to begin taking steps right now to make sure that their credit is at the highest level possible. In order to make sure that your credit is at its highest level, you need to know what affects your credit the most. The three components of a Credit Score that impact it the most are Credit History, Available Credit, and Years of Credit. 1. Credit History: Represents 35% of your Credit Score, and it is the history of how well you have paid your bills during the time you have had credit. This means that you need to pay all your bills on time. Late payments can cause your Credit Scores to drop significantly, and take the longest to repair. 2. Available Credit: Represents 30% of your Credit Score. Available Credit is just what is says, it is the amount of credit that you have available. For example, the number of credit cards you have, and how much of the credit limit on them is availabl.e If you are over 30% of the available credit limit on a credit card it has a negative impact on your credit. So a quick way to improve your credit to to pay down your credit card balances to less than 30% of the credit limit. This can quickly create a significant improvement on you Credit Scores. Also, closing out unused credit cards does not help your credit. You are better off keeping them open, because it adds to your available credit. 3. Years of Credit: Otherwise known as length of credit, this represents 12% of your Credit Score. This simply is the number of years that you have had credit, the more years that you have credit the better. It is wise for a young person to begin establishing credit as soon as possible in order to build a credit history. George Souto of McCue Mortgage Company is a guest blogger at the Eastern Connecticut Real Estate Blog. He'll be stopping by periodically to keep us updated on mortgage happenings around Connecticut. George can be reached at (860) 573-1308 | 
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