Are you wondering what your credit score has to do with buying or financing a new home? Don’t let your credit score keep you from being able to move forward with your real-estate dreams. We at GVC Mortgage recommend that you know what a credit score is, how it impacts financing a home loan, and how to find out your credit score.
What is a credit score?
A credit score is based off your individual credit report and represents your overall credit history and trustworthiness with past lenders. Your credit score is a numerical value between 300 and 900, and experts agree that most homebuyers fall in the 600-700 range. The higher your credit score, the more likely you are to qualify for a home loan.
How do mortgage lenders use my credit score?
Both your credit report and credit score greatly impact your ability to get a home loan. While you can say you’re trustworthy in every way possible, your past credit history is what mortgage lenders will use to determine if you will pay them back on time. Mortgage lenders use your credit score not only to determine whether you can take out a home loan, but also to calculate your loan amount and rate.
How can I discover my credit score?
Before applying for a home loan, most mortgage lenders recommend that you find out your credit score from all three credit reporting agencies: Equifax, Experian, and TransUnion. After determining your credit report and score, take the time to look through it thoroughly and dispute any errors, since it can take some time to clean up your credit score.
Do you have additional questions about credit scores and home loans? Contact GVC Mortgage at (317) 564-4906. One of our mortgage professionals can walk you through the home loan process and help you get one step closer to your home-buying goals.