What credit score do mortgage lenders use and other than that what is needed to buy a house?

What credit score do mortgage lenders use and other than that what is needed to buy a house?

The minimum credit score you’ll need to buy a home also depends on which credit score mortgage lenders are looking at. The FICO score, developed by Fair Isaac, is the most popular scoring model in the industry. Approximately 90% of mortgage lenders use this to determine your credit score and decide whether or not to approve you for a loan.

The VantageScore is an alternative to FICO scores that’s rapidly gaining in popularity. The VantageScore system was developed by Experian, Equifax and TransUnion and it considers things like your payment history, the amount you owe and the age of your accounts.

Both VantageScores and FICO scores range from 300 to 850 but because the two models use different algorithms, it’s possible for your scores to vary widely.

Apart from your credit score, lenders will look at your employment and yearly income to make sure that you will be able to make payments on time each month. They are looking to see if you have a steady source of income.

Lenders will also look at the area you are looking to purchase a home in because there are outside factors that might make increase the risk thereby increasing the credit score needed to secure a mortgage loan. As you can tell, there are many different requirements to buy a house so do not take the decision to become a homeowner lightly.