Residential Mortgage Credit Reports (What we pull) uses a scorecard tailored to our industry.

Same for the auto industry.. Their reports are tailored to their industry and take auto liabilities into more consideration.

Consumer reports should be close to what a credit card company pulls.

Some good tips would be:

1) Stay under 30% of revolving credit limits.
2) Opt Out from credit bureau solicitation. www.optoutprescreen.com When a report is pulled the bureau may sell your information. Just basic info but it is the main reason you get credit card offers in the mail.
3) Close out old revolving accounts. Sending the final payment does not close the account. Sometimes verbally telling them too does not either. YOu must send a letter in writing stating you want to close the account and it needs to be signed by all obligated signers on the account. (so ex's too if you had a joint account with an ex!)
4) Consumer inquiries do not affect your score but all other inquiries will. It varies on each score card as to when it hurts. I do not know how many. I really do not know if 2 score cards are the same or not the same... But I have seen 2 inquiries show that inquiries lowered the score when given reasons on a report that was a >720.

Let's add some more info that everyone see's hurt things.

What Gregg says is correct. Scoring is designed to rate the borrowers risk factor. The scoring modules are different for mortgage loans, installment loans and consumer credit. A borrower who is rated as a certain risk for a mortgage loan may be more or less of a risk for a installment or consumer loan.

As another poster stated, scores can be manipulated but the simple approach is really the best. Use credit responsibly, view credit obligations as just that - an obligation and check your report twice a year for accuracy. Do these things and you won't have to worry about your credit scores.

Hi, I'm new to this but by being so desperate to own my first home I have been forced to try and understand about how credit works in the home loan process. The fact is my husband and I have several small collections items (less than 200.00) on our credit that we are just now chipping away at each month. Up until 2 weeks ago we had no credit cards, I just applied. I'm a teacher and he's a comm. underwriter at Nationwide. We make decent money but we have no credit and can't qualify for a mortgage. All I hear is pay your bills on time which we do but those household bills and car payments aren't reported to the bureaus. Our credit hasn't changed in years. I hope the credit card helps but what else could we do? We want to buy a house in 6 months. Our scores are roughly around 540ish. We want them to be at 620< before we apply for a loan. Is this possible in a short period of time? I really want to see our scores increase...

Herre's something that I had posted before but hopefully it'll help you out on your planning. This is basically the model of the FICO score:

35% of the score is based on PAYMENT HISTORY
How recent- this the most important
How late the payment is. Negative weight is given (in this order:
30, 60 and 90 day lates)

30% of the score is based on BALANCES OF CREDIT
These are heavily weighted on revolving cards
If you have more than 50% of your limit, there is a hit
If you have more than 75% of your limit, there is a harder hit.
You earn more with smaller balances than with a zero balance

15% is based on your CREDIT HISTORY
The older the trade line, the positive weight
Ideally, they are looking for 3 – 5 trade lines
Ideally, 30 years is the perfect length of time to have a credit card
They divide the number of cards by the length of time
(Every time you open a card, it drops your score)

10% is based on the TYPE OF CREDIT
They are counting the number of trade lines in each category
A mix is best
They are keeping track of all accounts: open, closed & frequency
Installments through finance companies can hurt your credit
(This is something you have in common with late payers)

10% is based on the NUMBER OF INQUIRIES
There are parameters: it only goes back 12 months
Negative weight is given to: what kind, how often
The weaker your credit ability, the more negative impact per pull
Pulls of the same category count as one for 30 days.

Hope that Helps,