Having a good credit score is an important factor that a lending institution is going to look at when making the decision to trust you with a loan or not.
Most banks and lenders are going to want a minimum score of 620 to get you approved for a mortgage. Some will even go as low as 580.
The higher the score, the more advantages you have when it comes to a mortgage. Having a higher score is going to give you a better opportunity at getting a lower interest rate, which will help keep your monthly payments lower. Anything over a 740 is going to give you the best possible rates available at the time.
What are the variables that make up the credit score?
FICO takes into account: your current debts; your debts in relation to how much available credit; how long you’ve had your credit accounts open; and the amount of times you’ve been trying to open up new credit (inquiries).
KEEP IN MIND: when shopping for a mortgage, you are allowed to have multiple financial institutions pull your credit within a 45 day period and your credit report will only count it as ONE inquire and will result in only a slightly negative impact on your credit score. So if you’re serious about finding out what your ACTUAL score is, consult a mortgage professional to have them pull your score and put a plan together so you can have it the highest it can be for when you’re ready to buy a house.
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