Applying for multiple loans can help you find the lowest interest rate and/or the most favorable terms. Credit scores account for shopping inquiries on most account types. Do not worry about how rate comparisons affect ratings.

Taking out one of these loans is a different story. Now a host of factor determine whether qualifications will increase or drop.


Having a low credit score means paying more in interest to offset the probability that you may default on payments. Having a good rating means paying far less to use somebody else’s money.

However, your rating is not the only factor that lenders use to determine the price of money. They consider other factors when underwriting risk for credit cards, car loans, and mortgages.


Your credit score rating is much more than just your payment record. Just because you were late on several obligations in the past does not mean that you will never recover.

We all make mistakes. Sometimes bad things happen to otherwise good people, which affect their finances. Fortunately, the equations and data purge rules provide an avenue of escape.


Your credit score rating and debt to income ratio mean similar things to risk managers evaluating your loan application. Both metrics help predict your future ability to make on-time payments.

However, they source the data from two different places. This means that they are not the same. You have to manage both metrics actively in order to improve your qualifications.


Your credit score rating has a different meaning when it comes to buying a house. Mortgage lenders also look at your debt to income and loan to value ratios, plus your work history when evaluating a mortgage application.

Each factor does not work in isolation. You can balance a weakness in one with strength in another.