Three years ago Zillow combed through mortgage information in their Mortgage Marketplace and their hard work allowed them to gain some shocking insight into the state of credit availability in the United States.
Back in 2010 we were two years removed from the crash of the Real Estate market and it was difficult for many people to qualify for Mortgage Loans because, lenders were just starting to change their lending criteria to insure another crash of the Real Estate market didn’t happen again.
Over the last few months Zillow has been analyzing the effect that rising mortgage interest rates have had on credit scores, and loan-to-value (LTV) ratios, and they’ve found that close to 30% of people who want to buy homes in the United States will not qualify for mortgage loans.
Thanks to their research Zillow found that American’s who want to buy homes, and have credit scores that are under 620, won’t even be provided with a mortgage loan quote while potential borrowers, who have credit scores of 740, or better, have been receiving the best mortgage loan quotes.
Keeping the Focus on Credit Scores
Even though it’s shocking that 30% of would be home buyers are being turned away from buying homes, the importance of Zillow’s statistics shows every home buyer that it’s vital for them to focus on their credit score first, before they apply for a mortgage loan, because, the lower the credit score, the more money a potential home buyer can expect to pay during the lifetime of their mortgage.
For example: A borrower with a credit score of 740, who puts down at least 20%, can expect to pay at least $24,000 less than a borrower with a credit score of 620, during the lifetime of a 30-year mortgage loan.
For more information on the effect that your credit score has when applying for a mortgage, or to view the latest Bend Oregon Homes for Sale, contact me today by calling (541) 383-1426.