The results of countless studies have shown that potential home buyers, and even current homeowners, have an inflated view of what is really required to qualify for a mortgage in today’s market.
One such study by the Wharton School of Business at the University of Pennsylvaniarevealed that many millennials have not yet considered purchasing homes simply because they don’t believe they can qualify for a mortgage.
A recentarticleabout millennials byRealtor.comexplained that:
“About 72% of aspiring millennial buyers said they’re waiting because they can’t afford to buy…”
The article also explained that29% of millennials believe their credit scores are too low to buy. The problem here is the fact that theythinkthey will be denied a mortgage is keeping them from evenattemptingto apply.
Ellie Mae’s Vice PresidentJonas Moe encouraged buyers to know their options before assuming that they won’t qualify for a mortgage:
“Many potential home buyers are ‘disqualifying’ themselves. You don’t need a 750 FICO® Score and a20% down paymentto buy.”
So, what credit score is necessary?
Below is a breakdown of the FICO® Score distribution of all closed (approved) loans in July from Ellie Mae’s latest Origination Report.
Over 52% of all approved loans had a FICO® Score under 750. Many potential home buyers believe that they need a score over 780 to qualify.
If owning a home of your own has always been your dream and you are ready and willing to buy, or if you are a homeowner who wants to move up, find out if you are able to! Meet with a local real estate professional who can help you determine if your dreams can become a reality sooner than you thought!
WHO WE ARE
SCOTTIE SMITH II & ASSOCIATES is one of Dallas/Fort Worth’s fastest growing boutique brokerage firms. We are located in the historic Deep Ellum District of Dallas, Texas and focus on addressing the needs of home buyers, sellers, and investors. We do more than close real estate transactions; we help our clients build wealth and restore communities!
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