Manual Underwriting: Buying a home without a FICO score

Nearly every personal finance guru in America will tell you that it's important to build and maintain a high FICO score -- and that good credit is a sign of financial prudence and responsibility. Lenders will reward you for that responsibility with a lower interest rate loan.

The worship of the almighty FICO score has even been picked up by AOL's own welcome screen -- AOL.com recently ran the headline How Woman Got a 783 Credit Score. According to the article, "It's the kind of credit score that belongs to a person who spends her money and swipes her credit cards wisely."

That's really only partly true. In reality, a good credit score comes from using credit in a reasonably responsibly way: i.e. not missing payments and maintaining a reasonably low debt-to-credit-limit ratio. But a high credit score also comes from using credit a lot, and having a lot of different kinds of credit. The piece goes on to say that "Excluding mortgage, household expenses, a low school loan payment and two bank credit cards, her extra funds mostly go to savings with a little for herself and Quinn's needs. Not that (Stacey) MacGlashan is a big saver, either. (That's her admission.)"