Translating Your FICO Credit Score Into Interest Rates – Episode #54

September 18, 2008 by  
Filed under Episodes

This episode shows how your FICO credit score translates into an interest rate and a payment using the myFICO tool. This tool gives an indication of how much you can afford because it shows your payments for a mortgage amount you select. Plus the tool is setup for a 30 yr mortgage, a 15 year home equity line and a 36 month auto loan.

In addition, it allows you to choose a loan amount so that you can see a specific example of how your FICO score will translate into an interest rate and a payment.

So, a couple of examples to show you how this works for a conforming versus a jumbo loan. Note how the FICO score determines an interest rate band and then a corresponding payment. It’s important to remember other expenses when you are calculating how much house you can afford. Also see my video on preparing your FICO credit score to apply for a mortgage

FICO® score APR Monthly payment, $300K 30-yr Fixed Mortgage
760-850 5.791% $1,759
700-759 6.013% $1,801
660-699 6.297% $1,856
620-659 7.107% $2,018
580-619 9.451% $2,512
500-579 10.310% $2,702
FICO® score APR Monthly payment, $417K 30-yr Fixed Mortgage
760-850 7.146% $2,815
700-759 7.368% $2,878
660-699 7.652% $2,959
620-659 8.462% $3,195
580-619 9.628% $3,545
500-579 10.487% $3,810

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Comments

2 Responses to “Translating Your FICO Credit Score Into Interest Rates – Episode #54”

  1. RateNerd on February 17th, 2009 7:07 pm

    I love this – great way to see the tangible benefit of having a higher score! Thanks!

  2. Have a mortgage? Save $71,000 in interest payments - I Will Teach You To Be Rich on March 10th, 2013 5:37 am

    [...] How to translate your credit score into an interest rate. [...]

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