A FICO® credit score is a performance objective score. The performance objective of the credit score is the “likelihood of a consumer to have a 90 day late on their credit report in a 24 month period”.
Here are the 20 Reason Codes (or Score Factor) that can show up on a mortgage credit report.
1. Amount owed on accounts is too high
2. Amount owed on delinquent accounts
3. Amount owed on revolving accounts is too high
4. Amount past due on accounts
5. Derogatory public record or collection filed
6. Lack of recent revolving account information
7. Length of time accounts have been established
8. Length of time revolving accounts have been established
9. Level of delinquency on accounts
10. Number of accounts with delinquency
11. Proportion of balances to credit limits on bank/national revolving or other revolving accounts is too high
12. Serious delinquency
13. Serious delinquency, and public record or collection filed
14. Time since delinquency is too recent or unknown
15. Time since derogatory public record or collection is too short
16. Time since recent account opening is too short
17. Too few accounts currently paid as agreed
18. Too many accounts recently opened
19. Too many accounts with balances
20. Too many inquires in the last 12 months
65% of the score is controlled by 2 categories that make up a score. So if the consumer is looking for a few extra points the reason codes can lead you to areas where you may find inaccurate or unverifiable information that could be affecting the scores.
Call me and let’s review the “reason codes” that show up on your credit report, line-by-line.