Although there continues to be a mortgage crisis among many lenders, many first-time buyers continue to qualify with lower credit score, smaller down payment. As a first-time home buyer, you’ll find probably find it a little harder to qualify for a mortgage than a first-time buyer two years ago.
The credit crunch on Wall Street and record foreclosure rates have made investors nervous about home buyers who have small down payments and lower credit scores. While the number of first-time buyers is down, there are plenty of folks who are tempted by falling home prices and low interest rates. What kind of loans are out there for them?
The kind of loan you’re offered starts with your credit score and Fannie Mae and Freddie Mac are looking for credit scores of at least 660. “We’re absolutely accepting loans where borrowers have credit scores in the 600s,” said Craig Nickerson, Freddie Mac’s vice president of expanding markets. “There’s no question that the stronger the credit of the borrower, the better product they can obtain.”
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