As the economy continues to act erratically, many lenders are forced to take their own actions to help sustain themselves.
Lenders are making significant changes to FHA, VA and USDA loans. These changes could make home loans unavailable for mortgage borrowers who could have qualified just weeks earlier.
Some lenders have completely withdrawn government-backed loans ? refusing to offer them at all for the time being. And lenders that are still in the game have upped their minimum credit score requirements by as much as 100 points. To give just a few examples:
Wells Fargo has adjusted its minimum score requirement to 680 for all government loans (FHA, VA, and USDA)
US Bank also requires a 680 credit score for FHA, VA, and USDA loans, and 640 for conventional loans
loanDepot is requiring a 620 minimum FICO score for VA and FHA loans with a higher score (660+) for cash-out or streamline refinancing
Flagstar is requiring a 640 score for both purchase transactions and non-cash out refinances
Many other lenders are at 660 minimum for these types of loans.
While some lenders are still offering mortgage loans with scores as low as 620, many are setting standards so high that very few fit into the small window of eligibility.
For example, many lenders advertising a 620 credit score are doing so only if you can meet certain requirements. For example, you might need:
At least two month?s worth of payments in the bank
No gift funds allowed for down payment or closing costs
No non-owner occupants without a 680 credit score
For many people who choose government-backed loans like FHA or VA, the looser qualification guidelines are a big draw.
The more stringent requirements lenders are putting in place could make home loans inaccessible for many until coronavirus fears calm down.
Mortgage lenders are tightening their rate lock requirements too.
Many won?t allow mortgage borrowers to lock until their loan is clear to close.
Effectively, that means you might not know what your mortgage rate is until you?re ready to sign your final papers days before the loan is completed and potentially week or months after you applied.
Not all lenders are reacting the same way.
This means some lenders have not instituted minimum score requirements as low as their competitors. Some lenders may not be hedging as much as others, which means lower rates.
Now more than ever before, mortgage borrowers should shop around until they find a lender that can fit your needs.
Tony Nguyen | NMLS#93776
Vision Quest Lending | 2860 Michelle Drive, Suite 140, Irvine, CA 92606
Direct 714-464-8042 | 877-318-0992 x6502 | Fax 866-394-9352
Email | tony@vqlending.com
Website | www.visionquestlending.com
BBB A+
Apply online:http://visionquestlending.com/free_quote/
Lenders are making significant changes to FHA, VA and USDA loans. These changes could make home loans unavailable for mortgage borrowers who could have qualified just weeks earlier.
Some lenders have completely withdrawn government-backed loans ? refusing to offer them at all for the time being. And lenders that are still in the game have upped their minimum credit score requirements by as much as 100 points. To give just a few examples:
Wells Fargo has adjusted its minimum score requirement to 680 for all government loans (FHA, VA, and USDA)
US Bank also requires a 680 credit score for FHA, VA, and USDA loans, and 640 for conventional loans
loanDepot is requiring a 620 minimum FICO score for VA and FHA loans with a higher score (660+) for cash-out or streamline refinancing
Flagstar is requiring a 640 score for both purchase transactions and non-cash out refinances
Many other lenders are at 660 minimum for these types of loans.
While some lenders are still offering mortgage loans with scores as low as 620, many are setting standards so high that very few fit into the small window of eligibility.
For example, many lenders advertising a 620 credit score are doing so only if you can meet certain requirements. For example, you might need:
At least two month?s worth of payments in the bank
No gift funds allowed for down payment or closing costs
No non-owner occupants without a 680 credit score
For many people who choose government-backed loans like FHA or VA, the looser qualification guidelines are a big draw.
The more stringent requirements lenders are putting in place could make home loans inaccessible for many until coronavirus fears calm down.
Mortgage lenders are tightening their rate lock requirements too.
Many won?t allow mortgage borrowers to lock until their loan is clear to close.
Effectively, that means you might not know what your mortgage rate is until you?re ready to sign your final papers days before the loan is completed and potentially week or months after you applied.
Not all lenders are reacting the same way.
This means some lenders have not instituted minimum score requirements as low as their competitors. Some lenders may not be hedging as much as others, which means lower rates.
Now more than ever before, mortgage borrowers should shop around until they find a lender that can fit your needs.
Tony Nguyen | NMLS#93776
Vision Quest Lending | 2860 Michelle Drive, Suite 140, Irvine, CA 92606
Direct 714-464-8042 | 877-318-0992 x6502 | Fax 866-394-9352
Email | tony@vqlending.com
Website | www.visionquestlending.com
BBB A+
Apply online:http://visionquestlending.com/free_quote/