Credit Score Minimums Increase for Home Loans
Alternative content
credit score changes
credit score changesIf you’re looking for your next house, it’s time to buy. More homes are on the market and prices are falling.
The market is good, but is your credit score good enough get one?
Kevin Hampton at Anchor Home Mortgage in Spartanburg says credit guidelines to get a home loan have tightened, “Our target audience, the people that we are going to advertise to, the people that we are going to try to get a home for, they are going to have to have a lot better credit and also a lot better assets.”
Last year, Hampton could approve 100 % financing on a 600 credit score. Today, you’ll have to have a least a 680.
There is hope and ways to improve your credit score so you can move into a brand new home. It just takes time. “At least six months with on-time payments will help a lot,” said Brent Bishop at Compass of Carolina. Bishop is a certified consumer credit counselor.
Here’s how he breaks down what determines your credit score:
Payment history: 35%
Amounts owed: 30%
Length of credit history: 15%
New credit: 10%
Types of credit: 10%
Payment history, and how much you owe, determines more than half your score. While Bishop says those are most important, the number one recommendation that could increase your credit score today is to check your credit report for mistakes.
“Things like an account that’s still showing a balance or a medical bill that belongs to someone with a similar name, or just things like that pop up maybe challenged on the report where things are moved or adjusted,” Bishop said.
There’s only one government recommended website to get a free copy of your credit report: http://www.annualcreditreport.com.
Hampton says there are government programs that can get you a home loan if your credit score is low. Some of those programs cater to first-time home-buyers.
Anchor also says the multi-billion dollar bail-out package approved by Congress will make it easier to get home loans for consumers with bad credit, but it may take several months.
Advertisement
Reader Reactions
Dear Maxwell, www.annualcreditreport.com truly is the best site for every resident of SC can check their credit REPORT there for free once a year and this is the only official site I recommend to all my mortgage clients. In this short segment it would be hard to explain to consumers exactly how to do this. When you go to this site it will take you directly to each bureau as you described. But you can obtain your credit HISTORY for free from each bureau. If you want a score you will have to pay for it and it will cost you approx. $5-8 each bureau. The important part is to get the HISTORY, only pay for a score if you are curious and you could just pay for one to get a ballpark score. But the history from each is important as there can be different data on each bureau. Check it carefully once a year and dispute items that are not correct. Good idea to do this once a year just like getting a physical - do a credit “check-up” for yourself!
Well I should of known after all these years tha nothing is free,as this was reported on the News a few moments ago,after submitting my SS number it directed me to three choices for my Credit Score and each wanted to charge me for it. Thanks TV 7 maybe I misunderstood what you reported due to the fact that your sound engineers are unable to turn up your voices during your broadcast.
Maxwell
Advertisement