Incredibly low interest rates on Destin mortgage loans make now an excellent time to buy a Destin, Florida home or invest in a South Walton vacation property. However, in order to take advantage of today’s historic low interest rates, you’ll need a good credit score. Since the mortgage meltdown, banks have become gun-shy about lending out their money to anyone who might possibly have trouble paying it back. Conservative lending practices can make it difficult for potential Destin home buyers with a decent but not top-notch credit score to get the mortgage loan they need.
Your 3-digit credit score is what banks and other Destin mortgage lenders use to determine your credit risk; that is, your ability to pay off the loan. Credit scores range from 850 down to 300. Buyers who have a credit score of 760 or above shouldn’t have any problems obtaining a mortgage loan. If your credit score is on the borderline or lower, there are things you can do to improve your score:
Pay on time. Make credit card, rent, utility, doctor and other bill payments on time. Because payment history counts for 35% of your credit score, repeated late payments and can seriously hurt your chances of obtaining a mortgage loan, warn Destin Realtors . As few as 3 late payments can drop your credit score by 200 points.
Don’t max out credit cards. Lenders look carefully at a loan applicant’s debt-to-credit ratio; that is, the amount of credit available compared to credit used. If the amount you owe is more than 10% of your available credit limit, it could cost you 100 points on your credit score.
More tips for keeping your credit score low next time