As we all know getting a mortgage loan today can be challenge. Dealing with adverse credit can be somewhat unpleasant, but necessary to procure mortgage financing.

The credit score is an indicator of how likely you are to default on a monthly debt obligation in the next three months. The higher the credit score the better the terms of the mortgage.

Pure and simple.

However to get financing today, you actually don’t need to have an 800 credit score. You only need to have a credit score of 640.

Yes that’s right, 640 is the magic credit score for getting a mortgage loan!

If you are looking any other loan program ie non conventional meaning an FHA loan, a USDA mortgage, a VA mortgage or even Home Path Financing you need to have a least a credit score of 640.

Note: The middle credit score has to be 640.

Your credit report will have a high credit score, a middle score (which is the one that we use), and a low credit score.

A 640 credit score is usually comprised of a few past due items here and there, maybe some high credit card balances, an old collection account or two and/or past medical collections.

That’s the typical credit anatomy of the 640 score. If you have none of the following items listed above no lates, current on all monthly debt obligations and your credit card balances are zero or very low, it’s a safe bet, you at least have a 700 credit score.

640 is credit score required for obtaining any mortgage other than your standard conventional loan. Standard conventional mortgages are available with a 620 credit score, however there needs to be a minimum down payment of 20% (or 20% equity on a refinance). For the Sonoma County market, that is not an option for a lot of buyers who otherwise don’t have a huge down payment.

Get that mortgage loan, raise your credit score to 640.

Yes you can actually get your credit score up to 640. Maybe there’s high balances that need to be paid down on credit cards. Maybe you have cash in the bank and you’re not sure whether it makes sense to pay off debt to qualify.

Oh by the way… you are allowed to pay off debt to qualify for a home loan too. If your bank or loan officer you are presently working won’t allow it, get a second opinion because paying off debt to quality is permitted.

Credit repair takes time, sometimes upwards of 90 days or longer, but it’s worth it for you to be able to get into a house or refinance a mortgage loan to save money. You are being incentivized to purchase or refinance real estate today with interest rates in the low 4’s.

If you don’t have a 640 credit score read this information about how to get your credit score raised. If you would like to learn more about how to go about getting a mortgage loan or need to get your credit score to 640 contact us. We can go over your 640 credit score for getting a mortgage loan.