Credit Scores

      

Your credit score plays a large role in the type of financing you will be offered when looking to buy a home. Banks usually decide on the terms of a loan based on the credit score category that you fall in to. It is important to check into your credit score and to ensure that you take any necessary steps to improving your score as much as possible before deciding to finance a home. Here is a quick summary of how banks view your credit score in relation to financing:

• The lower the credit score, the more difficult it is to become approved for a loan and the loans that are obtained with a lower score will typically have a higher interest rate
• In order to qualify for conventional financing, a borrower must have a minimum score of 620; some lenders have raised the minimum score needed for conventional loans through overlays (rule overrides)
• The national average FICO score is 689