What the Fed’s Rate Cut Means for BuyersThe Federal Reserve cut interest rates on July 31, 2019 for the first time since the Great Recession took hold in 2008, though the move is not likely to
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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.