Getting A Mortgage - It's All About Risk
To a mortgage company, lender, or bank, mortgages are about RISK. In this business nobody trusts one single thing you say. Nobody does. You can be Billy Graham, the Pope, or a god. It means nothing. The only thing that counts in the lending world is records. Your history, in other words. Not what YOU say but what the written record of your payments attest.
Character
Now where does your history really come from? Basically, your character. When I was in grade school one day, I borrowed a dime from Billy to buy lunch. I told Mother about it when I got home. She cracked open the purse, handed me a dime, and said to hit the trail for Billy's house to pay him back. I said to her that Billy's house was far away and that it was only a dime. She said, "I don't care if it is a penny and in Cincinnati. We don't owe anybody anything. Take the dime to Billy."
Plus Example
I never forgot that one. It was such a powerful example that I beat it into my children. Mom reinforced that lesson before me all her life. A lot of parents didn't. Those that did...some of those children didn't emulate that standard. I have known lots of people who do not feel obligated to pay debts. Years ago a teenager in my youth group found a wallet at Tyrone Mall in St. Petersburg, Florida. He took the cash and dumped the man's wallet and I.D. I found out about it and tried to inspire him to return it, but nothing I said made sense to him. "Finders keepers; losers weepers" was his mantra. The man never got his wallet back, and the kid is and has been in prison many times for theft. I once tried to collect a debt for an employer. When I drove up, all the kids ran into the house. I heard them all inside as I hammered on the door. Once in a while an adult came and peeked through the blind to see if I was still there. They just stayed inside and never came out until I left. This technique had obviously been used with satisfying results often. The bill was never paid. I wonder what those kids are doing today. Somebody branded a different moral standard into these people. All of them have problems with who owns what and who is due what. I know another woman of whom was said, "She never saw a bill she liked to pay."
And It All Comes Back
It is exactly this attitude that is reflected in a thing lenders use to measure a borrower's risk and attitude to debt - CREDIT SCORES. It is not always reflective. Just most of the time. Many people have had pristine credit at one time, and then something happened – a divorce, medical problems, loss of a job, things like that. But unfortunately, those events get thrown into credit scores too. In any case, to lenders it is always the written record of attitude to debt and how you paid that moves them. And it is the written record of your credit score that tells them that.
Character
Now where does your history really come from? Basically, your character. When I was in grade school one day, I borrowed a dime from Billy to buy lunch. I told Mother about it when I got home. She cracked open the purse, handed me a dime, and said to hit the trail for Billy's house to pay him back. I said to her that Billy's house was far away and that it was only a dime. She said, "I don't care if it is a penny and in Cincinnati. We don't owe anybody anything. Take the dime to Billy."
Plus Example
I never forgot that one. It was such a powerful example that I beat it into my children. Mom reinforced that lesson before me all her life. A lot of parents didn't. Those that did...some of those children didn't emulate that standard. I have known lots of people who do not feel obligated to pay debts. Years ago a teenager in my youth group found a wallet at Tyrone Mall in St. Petersburg, Florida. He took the cash and dumped the man's wallet and I.D. I found out about it and tried to inspire him to return it, but nothing I said made sense to him. "Finders keepers; losers weepers" was his mantra. The man never got his wallet back, and the kid is and has been in prison many times for theft. I once tried to collect a debt for an employer. When I drove up, all the kids ran into the house. I heard them all inside as I hammered on the door. Once in a while an adult came and peeked through the blind to see if I was still there. They just stayed inside and never came out until I left. This technique had obviously been used with satisfying results often. The bill was never paid. I wonder what those kids are doing today. Somebody branded a different moral standard into these people. All of them have problems with who owns what and who is due what. I know another woman of whom was said, "She never saw a bill she liked to pay."
And It All Comes Back
It is exactly this attitude that is reflected in a thing lenders use to measure a borrower's risk and attitude to debt - CREDIT SCORES. It is not always reflective. Just most of the time. Many people have had pristine credit at one time, and then something happened – a divorce, medical problems, loss of a job, things like that. But unfortunately, those events get thrown into credit scores too. In any case, to lenders it is always the written record of attitude to debt and how you paid that moves them. And it is the written record of your credit score that tells them that.