Missing the boat on homeownership

Borrowers with low FICO scores need to target certain lenders

New York /
Jul.July 15, 2016 04:50 PM

From the July issueWhen lenders say their doors are open to homebuyers who don’t have the best credit profiles, should people believe them? Do first-time buyers qualified on income and other key criteria but who happen to have a FICO credit score in the mid-to-upper 600s really have a shot at getting a mortgage?

The answer is probably yes. But the latest statistics on credit scores and mortgages overall are sobering. Not only are average scores on new loans closed by lenders continuing to rise, but there’s growing evidence that large numbers of people with middling credit scores are simply not applying for mortgages. It’s not that they’re getting turned down — they’re self-selecting themselves out of the mortgage market, possibly because they assume their credit scores will get them rejected wherever they apply. In the process, they may be needlessly missing a chance to nail down 30-year fixed interest rates in the mid-3-percent range to buy a home. [more]


Related Articles

arrow_forward_ios
Current state of 201-207 7th Avenue and rendering of new property (Nisha Shetty for The Real Deal, Amie Gross Architects, Getty)
These renters are buying new co-ops for $2,500. How is that possible?
These renters are buying new co-ops for $2,500. How is that possible?
HomeLight CEO Drew Uher (HomeLight, iStock)
HomeLight lays off a fifth of its workers, weeks after raising $60M
HomeLight lays off a fifth of its workers, weeks after raising $60M
HomeLight founder and CEO Drew Uher: “Flat is the new up.” (HomeLight, Uher, iStock)
Proptech, meet fintech: HomeLight raises $60M and gobbles up Accept
Proptech, meet fintech: HomeLight raises $60M and gobbles up Accept
Louisville, Kentucky (iStock/Photo illustration by Kevin Rebong for The Real Deal)
Generation Z looking to mid-sized cities when buying a home
Generation Z looking to mid-sized cities when buying a home
Eric Wu, CEO and co-founder, Opendoor (Opendoor, iStock)
Opendoor stock soars on first profitable quarter
Opendoor stock soars on first profitable quarter
Eddie Lim, co-founder and CEO, Point (Getty Images, iStock)
Home equity financing startup Point raises $115M Series C
Home equity financing startup Point raises $115M Series C
From left: Mike Rothman, founder and CEO, Second Avenue; Kyle Asher, co-head, Monroe Capital's Opportunistic Credit Group (Second Avenue, LinkedIn/Kyle Asher, iStock)
Firm aims to tackle the problem with single-family rentals
Firm aims to tackle the problem with single-family rentals
DwellWell's Dan Simpkins (LinkedIn, iStock)
Startup that diagnoses home repairs says it can save institutional owners millions
Startup that diagnoses home repairs says it can save institutional owners millions
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...