Knowing Your Credit Scores

Pursuing a higher credit score is worth the effort. Credit scores affect the interest rate for your mortgage, auto loans, credit cards, and insurance (home, auto, etc.). Whether you are considering a new mortgage, staying vigilant about your credit is the best way to save money. Additionally, it is the best way to deter identity theft.

If you are considering purchasing or refinancing your home in the future, one of the first steps is reviewing your credit to ensure it is mortgage ready in advance of contacting a lender. The credit tips in this blog will also help you increase your credit scores and reduce your overall housing expense.

How Credit Scores affect your Mortgage Application

The higher your credit scores, the greater the selection of available loan programs and down payment options, lower interest rates, and decreased private mortgage insurance (PMI) premiums. It is important to note that credit score minimums can vary with each type of mortgage. FHA, VA, and USDA-RD loans typically allow greater flexibility with credit scores. Conventional loans in Shreveport are slightly more conservative, and your credit scores will impact your interest rate more. Your Mortgage Lender will review your information and credit scores received from the three credit bureaus: Equifax, Experian, and TransUnion. Your middle credit score (not the highest or lowest) is selected as the best representation of your credit and applies as your primary score for the application. If you are applying for a mortgage with another person, the lender uses the lower of the two borrowers’ “middle” credit scores for your loan application.

Your online Credit Scores are likely different from the scores provided to your Mortgage Lender.

Each type of lender is assigned a credit score model based on the type of credit risk for that lender. For instance, mortgages are typically 30-year, auto loans are typically 5-7 years, and credit cards offer short-term financing. Each creditor receives slightly different credit scores depending on the creditor’s type of lending and the scoring model used. Additionally, each of your creditors may only report your information to one or two credit reporting agencies, resulting in one of your credit scores being higher or lower than the remaining two. The credit reports/scores you see online likely utilize a consumer score model and not a model used by Mortgage Lenders.

Review your credit regularly without lowering your Credit Scores.

Reviewing your credit report does not count as a credit inquiry and does not lower your credit scores. Checking your credit regularly at is always a good idea.  This government-sponsored website allows you to retrieve your credit reports from each credit bureau: Experian, TransUnion, and Equifax. Print or save all pages and thoroughly review all the data listed on your accounts for accuracy. The creditors typically update the data every 30 days, so your balances shown on the report may not have been updated for the current month.  Do not purchase the credit scores offered through this site, though, as they are consumer scores and are not representative of the scores given to creditors. 

If you request credit from a lender (auto loan, credit card, mortgage, etc.), the lender retrieves your credit report, which counts as a credit inquiry. If several credit inquiries occur from one specific type of lender (mortgage, auto finance, or credit card company) within 30 days, it will only count as one inquiry. Each inquiry will lower your score by approximately 2-5 points.

How to maintain the highest Credit Scores

The highest credit score for each credit bureau is 850.  As consumers, we aim to maintain the highest scores to reduce interest and insurance costs.  These tips will have the most significant impact on improving your credit scores and ultimately reducing your costs.

  • Continue to pay all your bills on time, including your rent, mortgage, auto payments, credit cards, utilities, etc.
  • Reduce the balances on revolving credit accounts (credit cards and lines of credit) to approximately 30% of the charge limit for each account.
  • Existing credit card accounts or lines of credit without balances do not reduce your credit scores.  However, closing these accounts will affect your overall credit history and lower your scores.
  • Do not open any new credit or charge accounts of any kind.  The credit inquiry will likely lower your scores slightly. Also, opening a new credit account will immediately reduce your scores by 30-50 points.
  • Bring any past-due accounts to the current status immediately.  The longer the period of elapsed time since the due date, the more significant the negative impact on your credit scores.
  • If your credit reports include collection accounts, contact the collection agency (not the creditor), and negotiate payment of the debt. If the collection account is for medical services, and is less than $500, it may not appear on your credit report.   If it is $500 or greater, the collection account will automatically delete from your record once paid. 
  • For the lender to obtain accurate credit scores, remove credit disputes from your credit reports before applying for your mortgage. If you discover inaccurate derogatory information listed on your credit report, contact the creditor listed and request deletion of the data.  This process may take 30-90 days for the credit bureau to update your credit report.  

Credit scores change constantly, and any of the items discussed above will likely change your scores. The changes in your credit scores may show up quickly, or it could require a 6-12 month history to adjust your credit scores positively.

Credit Bureaus are the sources of your credit scores, and their websites provide consumers with accurate, detailed information about credit scores. The three websites are, and If you need to resolve past credit issues, credit repair companies are available for a fee, but you can update your credit reports for free. Follow the guidelines above and resolve any disputes with creditors immediately before it affects your scores.


You have the power to determine your Credit Scores and create savings!