Mortgage loans are also described by the length of time for repayment, such as 15, 30 or 40 years, and whether the interest rate is fixed or adjustable. Mortgage loans where the down payment is less than 20% usually requires private mortgage insurance (PMI) or government insurance or guarantee.
Sub prime lending practices of the last six years, which have relied on property appreciation, and in many cases appraisal fraud, have left many borrowers with mortgages larger than the value of their homes. If the borrowers cannot restructure these debts, then they cannot get back on their feet financially."
FICO scores are not the only credit agency scores. In addition to FICO, the three agencies may use different scoring models, although FICO scores are most commonly used in mortgage lending. FICO scores run anywhere from 300-900, depending on what system is being used. Credit scoring is a process designed to help predict the future; at least the future regarding whether or not you will live up to the credit obligations you incur now.
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