Should credit scores be in the 600s or 700s when buying a house? This has been a longstanding question in the real estate community that has yet to truly be answered. While many believe that a 600-range credit score is enough to get buyers into the home of their dreams, some stick to the traditional purchasing power found in better credibility and shoot for 700-range scores when seeking out a loan. So what is the best credit score for home buying? The answer is not all that complicated.
In reality, a credit score of 620 is enough to get you in the door of home ownership. Most banks will grant you a standard home loan so long as you can prove stability in terms of income, and have at least twenty percent of the asking price as down payment.
What is better
As with any instance of borrowing, it is best to enter the situation with your best foot leading you forward. Although you may be approved with a 620 credit score, it behooves you in the long run to present a record that speaks of complete creditworthiness when seeking out a loan. A score of 740 or higher guarantees the best interest rates and fewer fees. Even those in the lower 700-range may find themselves paying more for their mortgage over the life of the loan in this day and age of competitive financing.
How to improve
The best thing that anyone hoping to buy a house in the near future can do for themselves is know their credit score. Having full awareness of where you stand in terms of credit can improve your chances of being approved and relieves a lot of tension associated with home buying. Evaluating your credit report also allows you to spot errors and have them removed. Decreasing the amount that you owe on credit cards and other debt is another way to improve your score. Doing this not only relieves stress but also shows lenders that you are a savvy spender and ready to take on the responsibility of home ownership. In any case, do everything within your power to ensure that your credibility on paper is the best when buying a home.
Caymus Realty Solutions is your alternative source when you want to buy or sell quickly. We pay cash for homes in any condition, and sell them at fair market prices to consumers in the Pittsburgh area. Call us or check out our website today to learn more about our services.