One of the biggest questions people ask when they go to purchase a home in Houston, Texas is why are my mortgage credit scores different than others. Today so many people in Houston, Texas will track their credit scores using many different apps and websites. This leads people to wonder why the scores they see are different from each other. There are over 100 ways to compute a credit score across multiple methodologies.
The most common methodology is FICO and is used in 90% of all lending decisions. And just to make it even more confusing there are 49 different FICO based algorithms across multiple industries. In the mortgage industry, the mortgage FICO scoring model has 9 different algorithms. Typically speaking the mortgage industry produces the lowest scores of all the FICO scoring models. This causes a lot of confusion for consumers in Houston, Texas that are trying to buy a home in the Houston area and have been checking their scores on Credit Karma or other online tools.
Most online tools such as Credit Karma or IdentityIQ will use the methodology known as Vantage. The current version of Vantage is 3.0. Although the range of scores is similar to FICO, the scores tend to be about 30 points higher on average then a Mortgage FICO score. Vantage is predominantly used for consumer consumption. This has become a popular option for consumers in Houston, Texas to view their scores from their phones. FICO also has a consumer version of scores that are not used for lending decisions, these are FICO 8, 9 or 10. Like Vantage, these scores tend to be higher then Mortgage FICO credit scores. The consumer FICO score is popular with sites like Equifax and CreditWise from Capital One.
Bottom line is it’s important to see what is on your credit report in order to know how it can be repaired. The scores can be compared on the given sites to see if they are judged as bad, fair or good. If you are in the market to obtaining a home loan in the Houston, Texas area check with a credit professional from Elevate My Scores for more information and a free review of your credit report.
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