{"id":5726,"date":"2024-03-04T05:30:00","date_gmt":"2024-03-04T11:30:00","guid":{"rendered":"https:\/\/nwiloanguy.com\/blog\/what-to-know-about-credit-scores-before-buying-a-home\/"},"modified":"2024-03-04T05:30:00","modified_gmt":"2024-03-04T11:30:00","slug":"what-to-know-about-credit-scores-before-buying-a-home","status":"publish","type":"post","link":"https:\/\/nwiloanguy.com\/blog\/what-to-know-about-credit-scores-before-buying-a-home\/","title":{"rendered":"What To Know About Credit Scores Before Buying a Home"},"content":{"rendered":"

\"What<\/p>\n

If you want to buy a home<\/a>, you should know your credit score is a critical piece of the puzzle when it comes to qualifying for a mortgage<\/a>. Lenders review your credit to see if you typically make payments on time, pay back debts, and more. Your credit score can also help determine your mortgage rate. An article from US Bank<\/em> explains<\/a>:<\/p>\n

\u201cA credit score isn\u2019t the only deciding factor on your mortgage application, but it\u2019s a significant one. So, when you\u2019re house shopping, <\/em>it\u2019s important to know where your credit stands and how to use it to get the best mortgage rate possible<\/em><\/strong>.\u201d<\/em><\/p><\/blockquote>\n

That means your credit score may feel even more important to your homebuying plans<\/a> right now since mortgage rates<\/a> are a key factor in affordability<\/a>. According to the Federal Reserve Bank of New York<\/em>, the median credit score in the U.S. for those taking out a mortgage is 770<\/a>. But that doesn\u2019t mean your credit score has to be perfect. The same article from US Bank<\/em> explains<\/a>:<\/p>\n

\u201cYour credit score (commonly called a FICO Score) can range from 300 at the low end to 850 at the high end. A score of 740 or above is generally considered very good, but <\/em>you don\u2019t need that score or above to buy a home<\/em><\/strong>.\u201d<\/em><\/p><\/blockquote>\n

Working with a trusted lender is the best way to get more information on how your credit score could factor into your home loan and the mortgage rate you\u2019re able to get. As FICO<\/em> says<\/a>:<\/p>\n

\u201cWhile many lenders use credit scores like FICO Scores to help them make lending decisions, each lender has its own strategy, including the level of risk it finds acceptable. There is no single \u201ccutoff score\u201d used by all lenders and there are many additional factors that lenders may use to determine your actual interest rates.\u201d<\/em><\/p><\/blockquote>\n

If you\u2019re looking for ways to improve your score, Experian<\/em> highlights<\/a> some things you may want to focus on:<\/p>\n