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Credit Where Credit is Due
Mortgage lenders use credit scores to determine the risk that a borrower will default on a loan. Therefore, a credit score can determine whether a potential borrower qualifies for a loan, the interest rate and the maximum amount of a loan.

Ritch Workman, president of the Florida Association of Mortgage Brokers, says a FICO credit score above 720 indicates a highly creditworthy borrower. A score above 600 means a borrower may qualify for a conventional mortgage loan, but a score below the 580-600 range makes it very difficult to qualify.

Paying bills, credit card charges and other debts on time improves a borrower’s score; late payments, loan delinquencies and non-payments lower the score.