Credit bureaus typically compute your score although mortgage lenders may use systems of their own. The score is added to information about your income, job, down payment and net worth. In most of the industry, high-scoring people are granted loans at standard rates. They might pay up to 2 percentage points more. In general, credit scoring is good for subprime borrowers.
Computers can spot the people who seem more likely to repay.
As a result, they have better access to mortgages and at lower rates. Some subprime borrowers are still being overcharged. At the same time, borrowers who are virtually zero credit risks should probably be getting lower mortgage rates than they're paying now. Here's where tailored mortgages come in. Lenders are developing systems to match your interest rate more closely with your loan's entire risk profile.