What your credit score actually decides

Loan programs publish minimum scores. Lenders are then free to require more than the program does, and most of them do. That extra requirement is called an overlay, and it is why the number you read online and the number that actually gets a file through are frequently not the same.

Nobody advertises their overlays. So a site telling you a program starts at a particular score is telling you the truth about the program and not much about your chances. Two lenders looking at the same file can give different answers, and neither is lying.

This is also why I will not tell you that a given score means yes. What I can tell you is roughly how far a file is from the nearest threshold and what usually moves it — which is a different, and more honest, kind of answer.

Underwriting is reading a whole picture. The score is part of it, and it is the part people fixate on because it is the only part that comes as a single number.

• Steady income and how long you have earned it.
• What you already owe each month against what you bring in.
• How much you have saved, and whether it has been there a while.
• The story behind anything difficult on the report — and whether it is over.

A strong score with nothing else behind it is not a strong file. A middling score with steady work, real savings and an explanation that holds up often reads better than people expect.

• Payment history

  Whether you have paid on time, and for how long. This carries more weight than anything else on the file.

• How much of your available credit you are using

  Balances against limits. Carrying a lot relative to your limits pulls the score down even when every payment is on time.

• How long your accounts have been open

  Age helps. It is the reason closing an old card can work against you.

• Recent applications

  Each new application leaves a mark. Several in a short run read as pressure.

• Derogatory items

  Collections, charge-offs, bankruptcies, foreclosures. What matters is what they are and how long ago — the date is often more important than the amount.

Go to AnnualCreditReport.com. It is the federal site, it is genuinely free, and looking at your own report is not a credit pull. It does nothing to your score.

• Read all three bureaus. They do not always hold the same information.
• Look for accounts you do not recognize, balances that are wrong, and anything marked as still owing that you settled.
• Errors are common and they are fixable, but fixing them takes time — which is a reason to look now rather than the week you find a house.

Before you act on anything you find, ask. Some moves that look obviously right can work against a file depending on timing and on what else is in it. There is no cost to checking first, and undoing one afterwards is not always possible.