Credit Score Changes

Hi there!

Did you hear about the changes coming to your credit score?

The three digit number know as your credit score or your FICO score is about to be calculated in a new way. 


Changes will start to be seen this Summer in many financial areas, but not with home loan lenders.

Home loan lenders are likely to move much slower in adopting the new scoring method.

Some of the changes may boost your credit score by as much as 20 points!


So what are the changes?

  1. Currently a static month of debt is used so you can improve your score by paying things off a month or two before applying for a home loan. With the new formula, the past two years will be used to calculate your score. This will give lenders more insight into how a borrower manages debt, but may make it harder for borrowers to tweak their score before applying for a home loan.
  2. Missed payments will have less of an impact is they weren’t recent, but recent missed payments will have more of an impact on your score.
  3. Also, if you use a high percentage of your available credit for long periods of time, your score will be impacted more significantly.

Am I doomed? ;0)

No, not at all. The five factors that affect your credit score are still very much important.


  1. Payment History (no late payments!)
  2. % of Credit Used (pay off, but don’t close any accounts)
  3. Length of Credit History (older accounts are very valuable)
  4. Mix of Loans (revolving credit & installment accounts)
  5. New Accounts (don’t apply for any new accounts)

Reach out to me if you have any questions or want to better understand how these changes may affect your new home purchase. I’m always here to help. Tara