It seems that government regulations are losing up a bit when it comes to getting a home loan. Ellie Mae’s latest Origination Insight Report stated that the average FICO® score on all closed loans had dropped to 722 in November which is the lowest it has been since April 2017. This average included all approved refinance and purchase loans.
Better news is that millennials who are looking to buy can qualify with even lower FICO scores on FHA and VA loans. FHA refinance scores dipped to 645 in November with VA scores dropping to 700 to qualify.
A Millennial Tracker report posted by Ellie Mae showed that millennials purchasing in December had an average down payment of 4% with a FICO® score of only 684.
Ellie Mae’s Joe Tyrell commented that “with the average credit score dipping, lenders are extending credit to borrowers who may have had no previous access to the housing market.”
I would like to throw a caution out there that if you do have a lower credit score, do what you can to increase your score which means paying off outstanding debt. Don’t do a 2007 and get in over your head and become a short-seller because you can’t keep up with your payments. Our economy is growing stronger but slowly. With the new corporate tax cuts, you may be in a job where they will pass the savings on to you like Wal-Mart but then again maybe not.
As noted in my January newsletter, the average for a 30-year fixed rate mortgage rose to 3.99% this month compared to 3.90% for December. Professionals are predicted a steady rise in rates through 2018.
If you need a professional to look at your budget and help you decide if you can buy, give me a call and I can refer you to one. We all want you to be happy and secure in your new home.
And remember if you, a friend or family member need assistance with selling or buying a home I can help. Referrals and people needing relocation assistance are welcome! Search Single Family homes in Greenville. Search Condos and Townhomes in Greenville.