Jun 6 2019 38376 1
Most consumers overestimate what it takes to get a mortgage
When it comes to obtaining a mortgage, the majority of consumers think it requires a higher credit score and larger down payment than is actually necessary, according to a recentsurvey by Fannie Mae
Of the 3,647 surveyed consumers, most overestimated the requirements to obtain a mortgage. 53% thought a credit score of 650 was required, when many lenders actually allow a score of580.
And, when asked how much money a borrower is required to put down, 40% said they didn’t know. Of those who did have an idea, they cited 10% as a required minimum, while a number of programs offer as little as 3% down.
Only 23% of respondents were aware of low-down payment programs, up just 1% from three years earlier.
Further, when it came to debt-to-income ratios, consumers were equally confused, with as many as 61% saying they didn’t know – up from 59% three years ago. Of those who did provide a guess, they cited 40% as the required DTI, when many lenders actually approve 50%.
Fannie Mae’s survey also revealed that even those who were preparing to purchase a home in the next few years were only slightly more confident and more knowledgeable than the rest.
Fewer homes are selling at or above listing price. This is a really good time to think about buying a home since interest rates are at about a three year low and sellers are more motivated to negotiate.
If you have questions about the housing market or want to find out if you can qualify for a loan, talk to the guy who has your back, his name is Jack. I’m Jack Lees with TLC Realty. Visit my website at https://www.realestatejack.com where you can apply for a loan, search for homes in any area, and find out the value of your home.