Home Mortgage

Planning a wedding is very stressful but I think purchasing a home beat it by a long shot. Buying a home is one of the most exciting objective in a person's life. I remember when I purchase my first condo and I could not believe that it's mine. In fact, I had trouble sleeping for few days thinking about my first real estate property. It is like a wedding which is a very emotional experience and very personal. Anyway, if you are planning to buy a home, make sure that your credit history is good.

A person with a good FICO score will naturally have less stress than one with poor credit. If you have a credit score of 700 or over you could encounter some problems but only minor ones that could be resolved quickly as this is an excellent credit rating. But, if your credit is bad, put aside your fears. Even if you have a poor credit rating, filed bankruptcy or gone through a foreclosure, it does not mean you cannot buy a home. You most certainly can buy a home with bad credit but you will be paying more than a person who has an excellent credit.

If you have poor credit, you must do your homework when purchasing a home. You must do research on lender companies which are known as hard money lenders. They may require you to put down between 20 and 35% of the selling price. Another avenue would be to check out the guidelines for an FHA loan. If you qualify, you could put down as little as 3.5% . Some lender's interest rate will be very high and the loan terms are not as favorable because they could contain a pre-payment penalty and could be adjustable. Just make sure that you know your financial responsibility when you purchase a house. In that way, you will not be pinned in a money pit.

Significance of Credit Scores

Are you planning to buy a house where you plan to live most of your life? If you have a good credit then, obtaining a mortgage should not be too difficult. There is definitely an advantage to the person who has a good FICO score. This is the score that most lenders use to judge the credit worthiness of the borrower. A score of 640 or better will give you certain advantages such as low percentage of interest on your loan. This could be as low as 3.5% on your fixed 30 year mortgage.In the first quarter of 2011, nearly half of all mortgages went to people with credit scoresabove 750 on the FICO scale. .Back in 2005 your credit score did not really matter as much as it does today. In those days, you could get a loan by having a job and a Social Security number. Those were the days of easy credit. Mortgage lenders today are putting a lot of emphasis on the borrower's FICO score so; there is a definite advantage to having a good credit score when searching for a home mortgage. You can definitely see the advantage there of having a good credit score when obtaining a mortgage as lending has tightened. In a nutshell, a good credit score of 720 or over will help you qualify for the best interest rates. For more information, check out the link here.