Mortgage approval tips 2020For the past 3 months, mortgage interest rates have been averaging below 3% for 30-year Conventional loans. But Columbus home buyers may find that lenders are feeling less generous these days, making any advertised, ultra-low rates difficult to obtain.

Even as rates have declined, lenders have been increasing their credit score requirements. The Mortgage Bankers Association reports that the Mortgage Credit Availability Index (MCAI) dropped by 6.1% in September, indicating that loan approvals are down. The median FICO score for mortgage approvals nationally is 700. In “hot” markets, the median FICO score on approved mortgages is over 750.

What’s going on? Simply put, lenders have enough applications for home purchases and refinances that they can afford to be picky. Another concern is the economy. So far, economic damage from COVID-19 has struck certain industries much harder than others; yet lenders fear the snowball effect that a prolonged pandemic could cause.

Still, you won’t necessarily be denied for a mortgage if your FICO score is below 700 and your down payment is less than 20%. But the interest rates you are offered may be higher than the “teaser rates” shown on lender websites.

To get the lowest possible mortgage rate in the Columbus area, you’ll need the best possible credit score and a strong financial picture! Being financially prepared with limited debt obligations, a considerable down payment and a solid work history helps.

It’s also a good idea to work with Columbus area lenders who know our market! We can refer you to local lenders who will work hard to get you the best options. And as our Buyer-Client, you will get our help in evaluating your mortgage offers, to compare not only rates, but also the fees and costs that are part of your overall financing.

As your Exclusive Buyer’s Broker, we serve your best interests at all times! Unlike real estate agents and brokerages who represent sellers, as an Exclusive Buyer’s Broker, we only represent you, the buyer, getting you the best price and terms with no conflict of interest at all times.

Understanding this distinction could literally save you thousands of dollars not only on the purchase price and terms, but also on seller concessions and home inspection issues, whether you are a first-time homebuyer or an experienced homeowner!

Contact us with your home buying questions! Remember, we are with you every step of the way…all the way home!

Andrew Show
Exclusive Buyer’s Broker, CEBA-M, MCNE, CSP, PSA,e-PRO, CREM, ABRM, AHWD
Buyer’s Resource Realty Services
Serving Metro Columbus, Ohio with Exclusive Buyer’s Agents
7100 North High Street, Suite 204, Worthington, Ohio 43085
614-888-4110 | 888-888-4110 Toll Free | 614-839-4110 Fax