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What Does “Clean Credit” Mean??

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clean credit“Clean Credit” is a slang term used OFTEN in mortgage lending.

It refers most often to someone who has 12 months with no lates.  But it’s not just late payments, it also refers to 12 months with no collections filed.  12 months with no judgements of liens.

12 months with no one writing anything to your credit report except GOOD STUFF.  If you had some late payments on a couple of credit cards in the middle of 2004… and then you hit another rough patch in 2005, and then AGAIN in 2006 and 2007… we refer to that as “sloppy” credit. 

You could still have a credit score of 580 – but it shows a history of not paying on time.  For THIS type of borrower – the underwriter might need to see 18 to 24 months of CLEAN CREDIT!  This is particularly true if you are applying for FHA, VA or USDA home loans.

Connect with us on Google Plus or Facebook! If you have questions about qualifying for a USDA Home Loan in NC, call Steve and Eleanor 919 649 5058 Remember, the USDA Home Loan Maps could be changing September 1, 2013… in fact, almost 1/3 of North Carolina could LOSE the ability to do USDA Home Loans! Yikes!

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  2. You made some good points there. I did a search on the topic and found most people agree with your blog.

  6. I have read several articles about credit score com but they didn’t give me the complete picture but finally you article has done when i found it on Monday.

  7. Credit score is an integral part of your loan application.
    It can be obtained from Credit rating Agencies.
    TransUnion, Equifax. Innovis….
    You are entitled to a free copy of your credit score report.

    Try to get a hang of the negatives on your credit report.
    1. Charge off
    2. Collection account
    3. Credit Limit reduction
    4. Delinquency
    5. Incorrect information

    And dispute them or pay them off depending on their affect on your credit score.

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