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How Credit Score Affects Purchasing Power
Dated: December 10 2019
How Your Credit Score Affects How Expensive of a House You'll Be Able To Buy...
Your credit score is now the most important factor in determining how much house you can buy, so if you are in the market for a new home, you need to understand how it affects you.
In order to make it easy for mortgage companies to determine the risk of lending to you, they are using a system called credit scoring (also called "BEACON" scores).
When lenders look at your credit report, they can instantly see how much debt you have, how reliable you are with bill payments, and if you've had any bankruptcies within the last several years.
With your credit report, lenders get a "credit score" which takes all of this information and boils it down to a number between 300 and 900. The higher the number, the less of a credit risk you are seen to be, and this is how lenders decide which types of loans you will be eligible for.
As with all new things, there is controversy over credit scores.
To be eligible for some types of loans, you require a minimum credit score without any exceptions. And credit scores fluctuate over time. In fact, the mere act of applying for credit can lower your credit score.
Click here for access to a quick qualifier link on behalf of The Tom Gasparec Mortgage Team.
Connor has entered into the Real Estate business after completing his Bachelor of Arts at Western University in London Ontario graduating in 2015. He first completed his Real Estate training with C....
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