The Perception of FICO Scores in Qualifying for a Home Loan

California Real Estate Podcast with Karla Ferrando

Many buyers are misinformed about what it takes to buy a home. You don’t need a FICO score over 780, nor do you need 20% down. Here’s what you do need.

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If you’re thinking about buying a home but you’re concerned that your credit score might not be high enough, don’t automatically disqualify yourself. Over half of all approved loans have a FICO score under 750. According to KCM reports, countless studies have shown that potential home buyers and current homeowners have an inflated view of what is really required to qualify for a mortgage in today’s market.
One such study at the Wharton School of Business at the University of Pennsylvania revealed many millennials had not yet considered buying a home because they didn’t believe they could qualify for a mortgage. There is a significant part of the population that doesn’t think they will be approved, so they don’t even try. The study also quoted the Fannie Mae CEO as saying, “I do think there is a sense among buyers that credit may not be available, especially to those with lower scores.” However, before assuming you don’t qualify for a mortgage, know your options. You don’t need a 750 score or a 20% down payment to qualify for a loan, but what do you need?

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We can make your dreams of homeownership a reality.

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The average FICO score for all closed loans last year was 724, with 50% of them being under 750. Many buyers believe they need at least a 780 to qualify, but that’s simply not true. Here’s the bottom line: if owning a home has always been a dream of yours and you are ready and willing to buy, let’s find out if you can qualify for a loan. We can make your dreams a reality sooner than you thought.
If you have any other questions about buying or selling real estate in the Temecula Valley area, give me a call or send me an email. I'd be happy to help you!