Are you trying to get approval for a mortgage?
Can you afford the down payment and monthly mortgage payments?
For many Americans, buying a home is the largest investment and financial commitment they will make. As such, there are many considerations, like can you afford the down payment and how can you get the best deal on a mortgage?
For many prospective homebuyers, the process starts with knowing your credit score, but your credit score is just one factor that lenders will consider. For instance, did you know that the minimum credit score on Fanny Mae and Freddie Mac loans is 620? Yet, according to the Treasury Department, Housing Finance Reform: Access and Affordability in Focus, only 10% of new mortgages are to borrowers with FICO scores below 665!
Manage Your Debts: Your payment history will be evaluated to determine your credit worthiness. Pay your bills on time and maintain a low used credit to available credit ratio.
Start Building Your Assets: The more liquid assets you have, the more likely a lender will view you as less risky – and offer you a lower rate on your mortgage.
Establish Good Credit Behavior: The better your credit behavior, the more likely you will receive loan approval with favorable terms. So, pay your bills – including rent – on time, do not apply for more credit than you can afford, keep your accounts open as long as possible, and check your credit reports.
By taking the rights steps to improve your chances of approval for a home mortgage with favorable terms, you can get the best deal and buy the home of your dreams.