What does it mean to you as a prospective buyer?
In the world of real estate, the three most important words are “location, location, location.” In today’s post sub-prime mortgage world, the three most important words are “credit, credit, credit.” Today’s home buyer needs to understand the importance and significance of their credit score from a lender’s perspective.
The credit score is an indicator of the likelihood that a consumer will pay off debt without being more than 90 days late. Credit scores range from a low score of 300 to a high score of 850. In order to (a) qualify for mortgage financing and (b) get the most competitive interest rate in today’s mortgage world, I recommend that you have a credit score of 700 or above.
A high credit score means a low interest rate, which can save you tens of thousands of dollars in interest over a 30-year mortgage.
Credit scores should be checked at least once a year. The three main credit reporting agencies (CRA’s); Equifax, Experian and Trans Union have created a central website Annualcreditreport.com, to allow you to get a copy of your credit report. Many people ask me, “What are the factors that affect my credit score”? The answer is simple but not well known. To view my full article and to download the full list of credit score factors, click here.