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There have been many mortgage changes in the past few years, and it has kept mortgage professionals busy just keeping up with those changes. The housing crisis and economic recession are the main reasons for all the changes. What does this mean for first-time home buyer? It means they will face a different real estate market today than in the past.

Current homebuyers will need higher credit scores than they would have needed a few years ago.  You need a certain score just to be approved for the loan, and you need a certain score to qualify for the lowest rates available. Sometimes you’ll reach the first mark, but not the second. Both of these cutoff points have gone up over the past couple of years.

The exact score required will vary from one lender to the next, so we can only generalize things here. But it’s safe to say you’ll need to be above the 620 range to be approved for a mortgage, and above the 760 – 780 range to qualify for the best rates available. Lenders today are less willing to take risks on borrowers with bad credit. That’s partly the reason we had a mortgage crisis to begin with.

With great change also comes great opportunity.  Some investors are picking up houses that have gone through foreclosures and coming out very well. 

Home ownership is once again considered a privilege and not a right.

Submitted by Lynda Fleming, Customer Service Rep. for Integrity Mortgage & Financial Inc.