Credit Raiting Cards

New House Building: Money Saving, Convenience and Healthy House Tips

James Todd
July 2003

Beginning with the April 2002 edition, newsletters are now archived
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1. Credit Rating: How your credit rating can save or cost you money
2. Credit Cards: They don’t always have to cost you money
3. Useful Links
4. Thought for the Day
5. Subscription Information

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1. Credit Rating: How your credit score can save or cost you money.


Several years ago credit scoring had only a modest impact on home mortgages. That has all changed. Lenders studied the relationship between credit scores and mortgage delinquencies and found a definite relationship. Almost half of the borrowers with FICO scores below 550 became 90 days delinquent, at least once, during the term of their mortgage. Compare this to borrowers with FICO scores of over 800 – here the delinquency rate was only 2 in 10,000.

FICO stands for Fair Issac and Company and is the credit scoring system used by the three major credit agencies in the U.S. These three companies are Trans-Union, TRW (Experian), and Equifax.

How does you FICO score impact you mortgage application? In two ways. One way is in the acceptance or rejection of your application. The other is in the rate/amount that you get charged. For example, some lenders establish a base price and will reduce the points on a loan if the credit score is above a certain level. Other lenders, instead of reducing costs for good FICO scores will add on costs for lower FICO scores. The net result is the same. A lower FICO score may result in more costs or charges to the borrower.

Because of the impact of FICO scores on your mortgage it is important to understand those items which have a negative impact on it. Some of these are:

  • Deliquencies
  • Short Credit History
  • Revolving Credit accounts (credit cards/charge accounts), maxed or near limits
  • Bankruptcies, judgments, or liens
  • Too many revolving accounts
  • Too few revolving accounts
  • Too many credit inquiries

Protect your FICO score. It is an important factor in getting the best rates and lowest charges. What is the best way to do this. Live within your means, don’t open needless or an excessive number of charge accounts, and pay your bills on time.

Now that you have an understanding of the importance of credit scores, you can also understand why it is also a good idea to run a credit report on yourself. You may not think you have bad credit – and you may not – but what about that person who is using your social security number fraudulently, or the bill you never paid to that thief of an auto mechanic. It is well worth your time and money to take a look at your credit history and clear up any problems before you go talk to your friendly banker.

The following link will allow you to run a free credit report on yourself.

Once you see your personal credit information, you can determine if you have a problem, and begin to take the necessary steps to clear this up before apply for financing on your home. If you want to see you credit score this page also will give you the option of ordering a report that shows your current FICO score for a cost of $14.95.


How big of a house are you going to build?? Find out what size of mortgage for which you qualify. IndyMac Bank is your best online source for home mortgages. Online applications, quick approvals.

Don’t let your credit history become a headache in your new home building process. Check your credit. Get your free credit report today.

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Dream Home Source, Inc.- Search through over 12,400 professionally-designed stock house plans, from over 82 of North America's top architects and designers. Easy and fun to search for that "dream home".

2. Credit Cards: How they can SAVE you money!
Before you start your building process, make sure to find at least one credit card that pays you cash back. There are several available, however the best one that I have found to date is the American Express Blue Card. It has no annual fee and a 0% APR for the first six months. However the big attraction of this card is that it will pay 3% cash back on purchases. Actually it pays up to 5% but that is only if you have an unpaid balance in your account, which means that you will be paying interest, so I recommend you stick with the 3%.

What’s 3% worth? Well at least several hundred dollars. When you start your building project you will be purchasing a lot of items for your house, in addition to what your builder is buying. These can quite easily add up to thousands of dollars in purchases. Three percent (3%) of $5000 is $150. It's not a fortune, but it will definitely pay for a faucet, or several gallons of paint, a dinner for two or the purchase of the House N Home Guide.

Want other useful money savings tips for building your new home? Purchase the House N Home Building Guide today. It comes with a 100% money back guarantee.

3. Useful Links

The following are useful links relating to the housing industry and the topics covered in this newsletter and may be of interest.

FICO Saver for Home Buyers

Credit Land – Your Credit Portal

Eye On Credit


4. Thought For The Day – Human Dignity

Human rights rest on human dignity. The dignity of a man is an ideal worth fighting for and worth dying for. –Robert Maynard


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