 | Randy Vickers is the owner of Priority Mortgage Corp of Wichita, which opened in Jan. 1989, is the oldest locally owned mortgage company in Wichita. Randy has been in the real state business since 1983 and is a licensed real estate broker as well as a licensed mortgage broker. Priority Mortgage Corp of Wichita KS Lic #1996-0122. Randy can be reached at 316-721-7700 |
Real Estate
2005-11-01 16:19:00
Credit report ‘hiccups’
: I would like to know what happens if your credit report has no hiccups. And what are the benefits of having a clean slate?
ANSWER: There are obvious advantages to having a great credit score. First of all, you get a bigger cup of coffee when you are sitting in the office for the credit application to buy your home... kidding. The "conforming buyer", which you are with a good credit score, always gets the absolute best of available interest rates. Best interest rates translates to lower house payments. You have done your part and have shown the ability to manage your credit and pay on time. The approval process, either through the underwriter of the loan, or the loan committee if you were going through a conventional bank, is expedited when your credit is good. The loan approval will require less time and paperwork. You can begin making plans to move rather quickly when you know you are going to be approved, thereby not leaving the packing to the last minute. As we mentioned earlier, the buyer with "hiccups" on their credit report can still be approved for a loan to buy a home in most cases, but the interest rate is normally higher for them. Lower credit score translates into higher interest rate, but the difference is not normally high enough to make the buyer not want to buy the home. The advantages of owning a home far outweigh the small increase in rates caused by a poor credit score, in nearly every instance. With a good credit score, it's likely that the buyer can consider buying a more expensive home. Good debt-to-income ratios, combined with the good credit score, allow the lender to go along with more expensive real estate for that buyer because his risk of loss in the deal is minimized due to these good circumstances. If a prospective buyer of a home has any doubts at all about what they can or cannot buy, a prequalification appointment with a mortgage lender is a good way to remove the doubt. Most folks who go in for a preliminary loan application appointment leave with a pre-approval letter in hand. And there's no pain involved in the process. More next month...
