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Angel Tran, Renter in

Hi, What does my credit score need to be to purchase a home?

Asked by Angel Tran, Fri Jun 14, 2013

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Credit may be extended down to 580 depending on the loan product but be prepared to pay extra for it. The pricing will improve as you move up along the tiers... 620, 640, 680, 720, and 740. There are additional requirements by lenders as the risk increases... I recommend you meet with a trusted mortgage professional to see what improvements may be made to afford you a better price not to mention address other important requirements such as income and assets.
1 vote Thank Flag Link Fri Jun 14, 2013
Most lenders prefer a 640 credit score, however there may be some willing to work with less; since there are other factors besides credit that determine mortgage qualification, for a personalized answer visit with any licensed loan officer. Be aware that a mortgage pre-approval letter is required in order to determine your price range and for any offers to be taken seriously.
1 vote Thank Flag Link Fri Jun 14, 2013
Very interesting take on things Jim. I'm inclined to agree with you on that.

I think what Jim and Wendy are both getting at is that you should seek to get your credit in as good a shape as possible before pursuing a mortgage.

Buying a home is a large financial decision, and you should put yourself in position to qualify for the best terms.

Depending on your down payment, income, and other factors, you may be able to get a mortgage with as low as a 620 middle credit score. However, expect to pay a higher interest rate if you are at the lower end of the spectrum.

Take care of your finances first before you take the step of becoming a homeowner, because it's not just as simple as "Why rent when you can own"

Hope this helps!
1 vote Thank Flag Link Fri Jun 14, 2013
That depends on how much you want to bet against yourself. Credit scores are nothing more than odds, the higher the score the more likely you won’t have a problem paying back the loan. As Wendy mentioned a good score is rewarded with a better rate because the risk is lower for the lender, a low score gets a higher rate because the risk is higher. Most buyers that are concerned about their credit scores are trying to meet the minimum threshold, or translated bet on the long shot.

However, I don’t refer my clients to credit restoration or repair, never met a “repair expert” that didn’t coach their customers to commit mortgage fraud, linked some info below on this subject. Good luck,

Jim Simms
NMLS # 6395
JSimms@cmcloans.com
Financing Kentucky One Home at a Time
1 vote Thank Flag Link Fri Jun 14, 2013
Hi Tran,

Don’t overlook getting seller financing to get you into your own home. With good down payment, employment history and a collection account setup it can be safe, help repair your credit and get you in a home now.

Kevin Sucher
Principal Broker
503-214-4139
ksucher@prunw.com
0 votes Thank Flag Link Fri Jun 14, 2013
Credit restoration is NOT fraud and very different from credit repair. I do not recommend credit repair to anyone!
0 votes Thank Flag Link Fri Jun 14, 2013
The best rates are given to people with scores above 740 but you can get into a home with lower scores. At my company, the lowest score I can accept is 640 but there are lenders who will go lower. The lower your score, the higher the rate. You should get a report to see your score and if needed, work with a credit restoration professional with the goal of achieving a score of 740.
0 votes Thank Flag Link Fri Jun 14, 2013
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