The housing crisis may get more personal for struggling homeowners, even those who have perfect credit. RISMedia reports that homeowners seeking a loan modification or considering foreclosure to help them pay their mortgages might see their credit score fall sharply, thanks to the effects of the housing debacle.

It gets worse. Citing complaints from bankers that an applicant’s credit score isn’t good enough, changes are underway in how credit scores are calculated and applied, which will affect millions of homeowners. At the Risk Management Association’s annual conference, Kenneth Phelan, Fannie Mae’s chief risk officer, said that 60-62% of households will own their own homes — lower than the expected 69% before the housing bubble burst.

Someone who undergoes foreclosure but had a solid credit score before the start of the housing crisis could see their score falls more than 15% under the system used by VantageScore, a scoring mechanism involving the nation’s top three credit bureaus: Experian, TransUnion and Equifax.

Under VantageScore, those who pay their bills on time will be considered subprime borrowers, meaning they will have a more difficult time obtaining a loan from a bank. Banks are reluctant to lend money to subprime borrowers because they are afraid the borrowers will be unable to pay them back; many lenders who catered to subprime borrowers have since gone out of business.

In addition to credit scores, banks are taking other factors into consideration such as geography and the overall economy. So, someone who moves to an economically depressed area may have trouble buying a home, even if they have good credit.

Another solution offered by Tony Hughes, senior director of Moody’s credit analytics group, was to lower people’s credit scores during an economic boom and raise them during times of economic distress. In good times, people appeared to have pure credit scores, so they were able to borrow against home equity and pay off credit cards, but when home prices fell, the equity disappeared.

At the bottom of a recession, with a recovery in sight, according to Hughes, credit scores would be raised to reflect the idea that someone buying a home would be paying it off in an improving economy with home values increasing and a lower chance that they would lose their job. A person who lived in a distressed area and paid a loan during the recession could receive extra points.

The tragedy of this housing crisis is that, even those with perfect credit scores will be punished. Economists predict it could take years before people’s credit scores improve. Loan modification is considered the lesser of two evils because it does less damage to your credit score than foreclosure does. Bankruptcy is not good because it will appear on your report for the next seven to nine years.