I get asked all the time, “I’m ready to purchase a home” now what? So I spoke with my friend Melissa at Mid America Mortgage and together we put a list of some helpful tips.
- Credit scores are one of the most important factors in determining your mortgage rate.
- Credit scores aren’t everything, what’s on your credit report matters as well.
- Aim for a 760+ credit score to get the best pricing, be prepared to explain any derogatory items that appear on your credit report.
- Know the contents of your credit report and what your scores are before your lender does.
- Any mistakes can be corrected, but take time (several months of on time payment history shows that any problems in your past have been corrected and re-establishes you as a creditworthy borrower in the eyes of the lender).
- FHA now requires a minimum credit score of 600 if you put less than 10% down.
- Conventional loans generally require a minimum credit score of 620 (depending on the lender).
- Lenders pull all three of your credit scores and use the median score for qualification.
- Low credit scores can also disqualify you for certain loan programs and/or limit your options.
- Don’t mess with your credit before or during the loan application process.
- Disputes affect the accuracy of your credit score. Be sure that all disputes are either removed or resolved before applying for a loan. The lender will require before your loan is approved.
- Always check with your lender for their requirements.
Mid America Mortgage