Buying a home is the largest investment most people ever make. It's also one of the best.The satisfaction of a freshly cut lawm, enjoying the aroma of a home cooked meal, being greeted by your

Dated: January 27 2020
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Your credit score is one of the most important factors lenders consider when you apply for a mortgage. Typically, the higher your score, the lower the interest rates you’ll qualify for. Before you look at houses, it’s smart to check your credit score and pull your credit reports from the three major credit agencies. Addressing credit issues early on can help you raise your score before you apply for a mortgage.
To make things even more challenging...Changes are coming to credit scores. That may make it harder for some people to get a loan. FICO, developer of one of the most widely used scores by lenders, announced an update to its algorithm, which will change how consumers’ debt levels are weighed. This latest iteration of the FICO score, available this summer, is meant to help lenders better avoid credit risks and control default rates.
A FICO score of 800 or higher is considered exceptional; 740 to 799 is very good; 670 to 739 is good; 580 to 669 is fair; and 579 or lower is poor. Although it’s up to specific lenders to determine what score borrowers must have to be offered the lowest interest rates, sometimes even the difference of a few points on your credit score can affect your monthly payments substantially.
It is possible to get a mortgage with a low credit score, but you’ll pay higher interest rates and higher monthly payments. Lenders may be more stringent about other aspects of your finances, such as how much debt you have, if your credit is tarnished.
Keep in mind that credit requirements vary from lender to lender. Do yourself a favor and shop around with multiple lenders to find one that will work with you. Here’s a quick rundown of typical minimum credit scores for different loan types:
Conventional loans: Many lenders will accept a credit score as low as 620 for conventional loans, but they may have other requirements for those borrowers, such as higher income.
FHA loans: The Federal Housing Administration guarantees loans for borrowers with tainted credit and low down payments. You can qualify for an FHA loan with a credit score of 500 to 579 with a 10 percent down payment. Borrowers with a score of 580 or higher must put down at least 3.5 percent.
VA loans: Backed by the U.S. Department of Veterans Affairs, VA loans are offered to active and veteran military personnel and their families. The government doesn’t have a minimum credit score requirement to qualify for VA loans, though many lenders require a minimum score of 620.
If your credit score isn’t great, there are still options. Instead of settling for the mortgage rates you’re currently qualified for, consider postponing homeownership and working to revive your score and improve your options. Here are some quick tips to help:
Making the move to home ownership can be exciting, but knowing all the pieces that is involved is crucial. The experts at Maurer are here for you every step of the way. We can help you understand your credit score and recommend lenders to talk to. Give us a call.
Buying a home is the largest investment most people ever make. It's also one of the best.The satisfaction of a freshly cut lawm, enjoying the aroma of a home cooked meal, being greeted by your
Making your home look like a million bucks doesn't have to cost a fortune. You can achieve a high-end look for less using some creativity and these tips.With a little resourcefulness and these 12
Making your home look like a million bucks doesn't have to cost a fortune. You can achieve a high-end look for less using some creativity and these tips.With a little resourcefulness and these 12
Making your home look like a million bucks doesn't have to cost a fortune. You can achieve a high-end look for less using some creativity and these tips.With a little resourcefulness and these 12