Hi, I should be directing this to a credit specialist, I think.
However, I interested to know if anybody has information regarding how an interest-only mortgage will
affect one`s FIFO score. The balance owing will show up on your credit report and typically, it would be maxed out since , in my case,
I`m only paying interest. I positive cashflow on all properties, yet, the credit report states that one factor for my FIFO score is that: " I owe too much on revolving lines of credits or non-revolving lines of credit is too high". So if this is the case, what would happen to my FIFO score if I shift my secured lines of credit into fixed mortgages?
According to Fair, Isaac, the breakdown of your FICO score is as follows:
35% of the score is determined by payment histories on your credit accounts, with recent history weighted a bit more heavily than the distant past;
30% is based upon the amount of debt you have outstanding with all creditors;
15% is produced on the basis of how long you`ve been a credit user (a longer history is better if you`ve always made timely payments);
10% is comprised of very recent history, based on your efforts to obtain loans or credit lines in the past few months;
10% is calculated from the mix of credit you hold, including installment loans (like car loans), leases, mortgages, credit cards, etc.
So if an investor has many interest-only mortgages, your credit report would state that you have lots of debt. However, the same investor have have good payment histories as well.
For those of us who like to generate the highest score as possible, should rein investors be concern about obtaining interest only mortgages? Any general thought or comments?
Thanks,
Kir Luong, 995-4050
All Banners Realty,
Edmonton, AB.
However, I interested to know if anybody has information regarding how an interest-only mortgage will
affect one`s FIFO score. The balance owing will show up on your credit report and typically, it would be maxed out since , in my case,
I`m only paying interest. I positive cashflow on all properties, yet, the credit report states that one factor for my FIFO score is that: " I owe too much on revolving lines of credits or non-revolving lines of credit is too high". So if this is the case, what would happen to my FIFO score if I shift my secured lines of credit into fixed mortgages?
According to Fair, Isaac, the breakdown of your FICO score is as follows:
35% of the score is determined by payment histories on your credit accounts, with recent history weighted a bit more heavily than the distant past;
30% is based upon the amount of debt you have outstanding with all creditors;
15% is produced on the basis of how long you`ve been a credit user (a longer history is better if you`ve always made timely payments);
10% is comprised of very recent history, based on your efforts to obtain loans or credit lines in the past few months;
10% is calculated from the mix of credit you hold, including installment loans (like car loans), leases, mortgages, credit cards, etc.
So if an investor has many interest-only mortgages, your credit report would state that you have lots of debt. However, the same investor have have good payment histories as well.
For those of us who like to generate the highest score as possible, should rein investors be concern about obtaining interest only mortgages? Any general thought or comments?
Thanks,
Kir Luong, 995-4050
All Banners Realty,
Edmonton, AB.