How Credit Reporting Works

What Credit is

If you want to buy a home in New Hampshire, it’s useful to have credit. Credit is nothing more than an accounting of your payment habits to creditors: credit card companies, auto payments, landlord, utility bills, doctor bills, etc….

Credit Bureaus and Repositories

Your credit history is monitored by three “Business Information Providers” or “Repositories”: TransUnion, Experian, and Equifax, who gather information from creditors, public records and smaller local credit bureaus or “CRAs” (Consumer Reporting Agencies like CBC of New Hampshire).

The three big repositories and their local affiliate credit bureaus sell the information they have gathered to creditors, employers, landlords, and other business with a recognized need. As a New Hampshire mortgage banker, we will use credit information to help you get the best mortgage program possible.

Here's an example as to how the credit system works:

• When you apply for a mortgage, we request a copy of your financial history in the form of a credit report from TransUnion, Experian, and Equifax. This inquiry will be recorded on your credit report.
• We use this credit report data and the accompanying credit score to determine what mortgage program and interest rate to offer you.
• You complete the home purchase and begin the monthly payment process. We report your mortgage payment history every 30 days.
• TransUnion, Experian, and Equifax update your credit file as they receive new information each month. Your credit profile changes based upon this financial activity.
• The next time you apply for a credit card or loan, the process repeats.

Have a question about your credit and qualifying for a mortgage? Call Charley Farley at (603) 471-9300 or e-mail charley@charleyfarleyhomeloans.com.