Read below to find out…
A “good” credit score is a very relative term because “good” means different things to different people. I know mortgages, so although I have an idea of what a auto lender might think is a “good” score, I can tell you for sure what it takes to get a mortgage!
The current minimum score for most home loans is 620. You will find a lot of information online that suggests FHA loans do not have a minimum and that is true. The problem is that the lenders who provide the FHA loans have put their own requirements on top of what FHA requires. It will be next to impossible to find a loan right now if your score is less than 620.
The original question was about “good” not minimum so let’s look at how your score can effect your terms. Fannie Mae has come up with a pricing grid that determines an extra cost or lower cost based on your credit score. I will give you a real life example so it is easier to see the true dollar costs…
If you were buying a home and the loan amount was $200,000 and you were putting 10% down, you would be charged the following based on your credit score:
720+ would be $0.00 extra charge but no discount
700-719 would be an extra $1,000 in cost
680-699 would be an extra $1,500 in cost
660-679 would be an extra $3,500 in cost
640-659 would be an extra $4,500 in cost
620-639 would be an extra $5,500 in cost
Below 620 would be an extra $6,000 in cost (if you can even get approved)
If you would like to know how to maximize your credit score so you can benefit from the BEST rates for mortgage loans, car loans and credit cards, please call Olan Carder at 980-721-7478. You can also visit our partner company, HOPE USA, that specializes in credit education by clicking here.