Before purchasing your home, you may find yourself searching in the market for mortgage loans. Finding a good mortgage lender can help you solidify the funding needed to secure a home and can help to simplify some aspects of the homebuying journey.
How does a mortgage work?
So, what exactly is a mortgage? A mortgage is a loan with terms often ranging from 10 to 30 years in which a borrower is awarded financing to purchase a residential property. Monthly payments of a mortgage loan go towards the principal balance, mortgage insurance, property tax and interest rates.
Tell me the minimum credit score required for a home loan?
On average, many mortgage lenders offering conventional loans require a credit score of at least 620 to demonstrate good credit history. Loan types such as FHA loans do allow borrowers to qualify with lower credit scores; however, this often comes with higher interest rates and a larger down payment requirement.
If you’re in need of a larger mortgage, you may be considering applying for jumbo loans. Due to the higher amount of financing being borrowed, the average credit score needed to qualify for a jumbo loan is around 700.
Review methodology
As you compare and review different mortgage lenders and loan types, there are a few great factors to consider to narrow down your search:
- Do they offer lower interest rates?
- Do they have good costume reviews regarding communication and integrity?
- What fees do they charge in connection with taking out a loan?
- Do they have local servicing?
By reviewing your credit history and doing research on
