Credit Scores are created by a mathematical formula that reviews a person’s outstanding credit, credit history, and past payments. Credit scores can range between 300 to 850 and are used to help lenders determine how likely you are to make your proposed payments on time. The higher the score, the less likely people are to default on their loan.
Topics: FICO score, first time homebuyers, homebuyers, credit, credit report, credit score
When it comes to applying for a mortgage, your credit score is the main factor in determining everything from your interest rate, to your monthly payments, and the terms of your loan. Lenders use credit scores to determine the amount of risk they are taking when issuing a loan. The lower the credit score, the higher the risk that is associated with the borrower.
The good news is you don’t need a "perfect" credit score to secure financing. There are home loans available that only require a minimum of a 580-credit score. However, the better your score, the better your chances are of getting a favorable loan, and potentially better interest rates.
Topics: first time homebuyers, homebuyers, credit, credit problems, credit report, credit score, minimum credit score, credit qualifying
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