Credit Proofreading is an Effective Strategy for Raising Credit Scores and Building Referrals

Brokers today are finding it increasingly difficult to close loans and maintain profitability. This is due in part to the shifting market conditions but also is directly related to brokers’ understanding of credit usage and data. Acting as more of a consultant to the borrower is an important step for brokers in positioning themselves as an ally in the search for a home. A stronger understanding of borrower behavior and credit data will enable brokers to close more loans in a down market.

First, brokers need to have a solid grasp of all of the elements used to comprise a borrower’s risk score. Borrowers’ risk scores are primarily affected by two factors: client behavior and credit data. The data contained in a borrower’s credit report is used to generate a risk score by comparing the borrower against the entire database. As a result, two borrowers may have radically different components comprising their credit scores, but still end up with similar scores.

Once brokers reach a level of understanding of the factors impacting a borrower’s risk score, they are in a better position to offer the borrower solutions to raise the score and qualify for a better loan.

Please click here to read the rest of this article.