In simple words, a mortgage is a way to use property like land, building etc. as a guarantee to get a loan. Credit score affects mortgage to a great extent as it is one of the eligibility criteria in getting a mortgage loan. The reason for this is that lenders want to make sure that their investment would make profit or at least get recovered. Your Credit score defines what kind of mortgage rate you would get, which would in turn help you identify what kind of home you can afford.
When you are looking to get qualified for a mortgage, your credit score and credit history are the first things in which the lender would be interested in to check your eligibility.
When you are looking to get qualified for a mortgage, your credit score and credit history are the first things in which the lender would be interested in to check your eligibility.
A good credit rating always helps when you are getting a mortgage. Even during financial crisis, people with good credit scores get mortgages with very less down payments. Analyzing your credit report, the lender makes decisions about the terms of qualification of your loan. Therefore building your credit score is the first step you can do to qualify for a mortgage.
Mortgage eligibility credit score recommended is usually above 500. A credit score of 500 to 520 is the lowest what lenders would go, anything less than that would disqualify you for the mortgage loan. People with high credit scores above 750 are the ones who get varied loan choices and also low interest rates.
Your credit history, other than contributing to your credit score, also influences the lender’s decision. The lender would want to see if you have been bankrupt, your payment history and also If you have had any collections. This will help the lender analyse your financial behavior and if you are about paying off debts or not.
Your credit history, other than contributing to your credit score, also influences the lender’s decision. The lender would want to see if you have been bankrupt, your payment history and also If you have had any collections. This will help the lender analyse your financial behavior and if you are about paying off debts or not.
Since, we saw above how credit score is important ingesting qualified for a mortgage loan, let us now deal with what a credit score is-
It is a calculation based on credit history which would help in determining your credit worthiness. It is important because it helps the lender figure out if his money would be safe with you or not.
Lenders rely on the information given by CIBIL to determine whether lending you money is a smart move or not. If your credit is more than 750, then lenders would deem you credit worthy for a mortgage and give you their standard loan options.
It is a calculation based on credit history which would help in determining your credit worthiness. It is important because it helps the lender figure out if his money would be safe with you or not.
Lenders rely on the information given by CIBIL to determine whether lending you money is a smart move or not. If your credit is more than 750, then lenders would deem you credit worthy for a mortgage and give you their standard loan options.
Your best bet to get a good mortgage rate is to have a credit score more than 750. A CIBIL score of 500 is bad and would h. Some lenders would also expect you to part with at least 50% of the purchase values if you are trying to get a mortgage with such low scores.
So, all this shows how credit score affects mortgage and how important it is to have a good credit score.For score improvement and repair opt for service packages available at www.cibilconsultants.com
hurry book an appointment now !
hurry book an appointment now !
Source: Secondary
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