Credit scores and the home buying public
April 04, 2024
Credit scores and the home buying public
In order to successfully purchase a home, credit scores are an important part of the process. Lenders will review your scores to see if you make on time payments and pay back your debts. A good credit score may help determine your mortgage rate, too.
While credit scores arent the only deciding factor for loan approval, its a very significant one.
The Federal Reserve bank of NY states that the average credit score for those taking out a mortgage is 770.
Credit scores can range from 300 at the low end to 700 and above. Many lenders use the credit scores to make a lending decision. There is no single cut off score, since lenders make their own rules depending on the level of risk they find acceptable.
You can improve your credit score by making payments on time and paying off any late charges quickly.
Your debt amount vs your credit limit: the less of the available credit you use, the better, focus on keeping this number low.
Dont apply for additional credit before you apply for a loan. This includes buying a car or setting up an additonal credit card.
