September 13th, 2016 7:27 AM by Jackie A. Graves
about what it takes to get a mortgage in today's market? Here are the
facts to dispel the two biggest myths about qualifying for one.
Myth: I need perfect credit to
get a loan.
Fact: Your credit plays a
significant role in qualifying for a mortgage. Generally speaking, a higher
credit score can mean a better chance of getting approved for a loan and
securing a lower interest rate. Good credit is important, but it's not the only
thing lenders take into account. Lenders also look at 3 other Cs when deciding whether to make you a
loan – your collateral, capital and capacity to pay back the loan.
While credit standards are higher now than they were a decade ago,
they are actually about the same as in the mid–1990s. If you factor into
today's historically low interest rates and current home prices, an affordable
mortgage could be within your reach.
Myth: I need to put 20% down.
Fact: This is perhaps the biggest myth in the
market. Today borrowers can get a conforming, conventional mortgage with a down
payment of as little as 5%. Most homebuyers are putting down between 5 and 10%.
In fact, last year nearly a third of the 1.6 million loans that Freddie Mac
funded were to buyers putting down less than 20%.
And some products, such as our Home Possible AdvantageSM mortgage, require a down payment of as
little as 3%. You have choices when it comes to your down payment so talk to
your lender about what makes the most sense for you.
Courtesy of Freddie Mac - To view the original article click here