Before you jump head first into searching for your dream home, you need to ensure your finances are in order. This includes reviewing and strengthening your credit. Here’s what you need to know!
Why Your Credit Score and Report Matters
As a buyer, a strong credit score and report makes you a more desirable loan candidate. When deciding to approve you for a home loan, mortgage lenders take a deep dive into past car loans, student loans, credit cards, bills, and more. They also review your history of repayment and public-record information. If their findings are positive, they will be much more likely to approve you for a loan and offer lower interest rates and better terms.
What Credit Score Do You Need
The credit score required for a loan depends on the type of mortgage you select, the size of your down payment, and your lender. According to QuickenLoans, most lenders require around a score of 620 or higher to be approved for a conventional mortgage with lower interest rates and flexible repayment periods. If a buyer would like a Federal Housing Administration (FHA) loan, they require a minimum score of 580 and, for a loan through the U.S. Department of Veterans Affairs (VA), score requirements differ depending on the private lender.
How to Improve Your Credit
Reviewed your credit score and realized it may need some work? There are ways to improve your score. These include, but are not limited to, correcting payment errors on your credit report, ensuring you make all payments on time, making micropayments in between due dates, and paying down credit cards.
If you live in Delaware or Pennsylvania and find yourself in need of more living space for your family the Scott Farnan Team at Patterson Schwartz is here to help. The Farnan team can answer questions on staging and closing to home inspections and what repairs are required to sell, The Scott Farnan Team offers clients over 25-years of real estate and client services experience, all with the indelible backing of Patterson-Schwartz, Delaware's largest independent REALTOR® and leader in the Mid-Atlantic region. The Farnan team is prepared to guide you through the buying/selling process, connect you with trusted partners and aim to reducing the levels of stress that typically come with buying and selling a home. Contact us today to get started or search our current listings.