Loans scarcer for low credit scores
Add a Comment 
bad credit mortgages, low credit loans March 15th, 2008Tougher standards may result in big down payment
Would-be homeowners with middling credit scores are finding mortgages difficult to come by as wary lenders clamp down on credit.
Credit score guidelines for conforming loans - loans eligible for purchase by mortgage giants Fannie Mae and Freddie Mac - tightened in late February, said Brian Goode, president of Badgerland Mortgage Group Inc. in Racine.
Customers making a down payment of less than 20% of the loan now need a FICO credit score of at least 680, he said, while those borrowing most or all of the value of their homes need scores north of 730.
Two borrowers with very different credit scores might have landed the same interest rate a year ago; now, risk-based pricing, tiered by credit score, has been on the rise since Fannie Mae and Freddie Mac introduced it in December.
Tags: bad credit mortgages, low credit loans
