Axia Financial DBA Pilgrim Financial Group. Currently we are servicing WA, OR, ID & CA only. We provide wholesale,construction,commercial & correspondent lending.

Why Your Credit Score Is So Important The credit scoring model seeks to quantify the likelihood of a consumer to pay off debt without being more than 90 days late at any time in the future. Credit scores can range between a low score of 300 and a high score of 900. Most consumers have a credit scores ranging between 400 and 800. The higher the score, the better it is for the consumer, because a high credit score translates into a low interest rate. This can save literally thousands of dollars in financing fees over the life of the loan. Only 1 out of 1,300 people in the United States have a credit score above 800. These are people with a stellar credit rating that get the best interest rates. On the other hand, one out of every eight prospective home buyers is faced with he possibility that they may not qualify for the home loan they want because they have a score falling between 500 and 600. The Five Factors of Credit Scoring Credit scores are comprised of five factors. Points are awarded for each component, and a high score is most favorable. The factors are listed below in order of importance. 1) Payment History -- 35% Impact Paying debt on time and in full has the greatest positive impact on your credit score. Late payments, judgments and charge-offs all have a negative impact. Missing a high payment will have a more severe impact than missing a low payment, and delinquencies that have occurred int he last two years care more weight than older items. 2) Outstanding Credit Balances -- 30% Impact This factor marks the ratio between the outstanding balance and available credit. Ideally, the consumer should make an effort to keep balances as close to the zero as possible, and at leas 10% below the available credit limits. ( A balance 30% below the available credit limit is better. ) 3) Credit History -- 15% Impact This portion of the credit score indicates teh length of time since a particular credit line was established. A seasoned borrower will always be stronger in this area. 4)Type Of Credit--10%Impact A mix of auto loans, credit cards and mortgages is more positive than a concentration of debt from credit cards only. 5) Inquiries -- 10% Impact This percentage of the credit score quantifies the number of inquiries made on a consumer's credit within a six-month period. Each hard inquiry can cost from 2 to 25 points on a credit score, but the maximum number of inquiries that will reduce the score is ten. In other words, 11 or more inquiries within a six-month period will have no further impact on the borrower's credit score. Note that if you run a credit report on yourself, it will have no affect on your score. Remember that the credit score is a computerized calculation. Personal factors are not taken into consideration when a credit report is generated. It is merely a snapshot of today's credit profile for any given borrower, and it can fluctuate dramatically within the course of a week.