Does A Mortgage Show Up On Both Borrowers’ Credit Report?
This will depend on whether you have a joint account or not. If the mortgage is to be under one person’s name, then only that person’s credit report will reflect it. However, if you have a joint account (where both your names are listed on the billing) then it will be on both of your credit reports.
This would be an excellent way to help you build a great credit score so you are able to get yourself into a home of your own. Make sure to stay away from late payments, collection, and bankruptcy. Credit companies don’t really care if you are late paying your bills, as they will still send you a statement every month. Please realize that just one 30 day late payment can take your credit score from an excellent 720 down to 680 in a heartbeat. Yes, just one 30 day late payment can take 50 points off your credit score!
You may think that after trying to avoid paying your debts, and after they send you to collection, that years down the road it will have come off your record because of the aging…well, think again! Those unpaid debts will still be listed on your credit report and a mortgage lender has the ability to force you to settle those old debts before he will approve anything for you, and then he will raise your APR.
Filing for bankruptcy can hit you harder than anything else, and could take hundreds of points off your credit score, as well as staying on that report for a long period of time…even up to ten years. A bankruptcy, however, does not automatically bring a credit score down. Some mortgage people have often reported instances of people with past bankruptcies on their credit report that earned better scores than some borrowers with one. Borrowers who have established new credit after a bankruptcy, and proceed to maintain an excellent credit history with everyone they owe, for at least two to three years, can often achieve more acceptable credit scores than people who have NEVER EVEN HAD a bankruptcy on their credit score!
A borrower’s amount of debt against their available credit is another credit scoring factor. A person who has borrowed $19,995 on credit cards with a $20,000 credit limit will definitely be penalized by all credit scoring systems every time, even with a perfect payment history. Creditors reason that a borrower who is at maximum credit limits will have no room to handle any emergencies that could arise during the time of the loan. The only problem with this is the borrower might have $100,000,000 in a bank account to handle an unexpected emergency, but the credit scoring will not take this into account.
Because all the studies appear to show that the credit scoring systems are fairly accurate at predicting whether a borrower should be approved for a mortgage loan, most of the lenders who sell loans have adopted the credit scoring guidelines. The bottom line is that people with a credit score over 660 will have acceptable credit. Those with scores between 620 and 660 will probably be approved, but will most likely have to work harder for their approval by showing other positive factors (such as a large amount of assets, steady income, employment, or large equity positions) to support their application.