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Why are such high credit scores required??

Why is it that lenders will not go below 640, when FHA it's self goes down to 500 for a 203k mortgage. Leaves people like me in the dust, while working our tails off to get some where.if it wasn't for inaccuracies, & applying for a mortgage hammering at my scores I would have been in the range. but NO mortgage company seems to take any of that into account. an awful lot of faith put into numbers that can be totally off!! by dibbledavid4 from Rochester, New York. May 14th 2012 Reply


William J Acres (William_Acres)
#73 ranked lender in Arizona - 8,722 contributions

It's all about risk vs. reward... but the lender needs to know the risk.. and that's what the credit score is supposed to do... show the lender the probability of this loan going bad... the model used to determine the likely hood of a potential borrower's default rate is gauged by this score, and although it's not perfect science, it's fairly accurate... there are ways to "fool the system", however a competent loan officer can explain this to you... that being said, there are lenders out there that will go below 640... Some as low as 500. The best advice I can give you is to contact a LOCAL mortgage broker, not the local "Big" bank, and certainly not one of those 50 states internet lenders...By applying with your LOCAL Broker, you have an advantage because he's familiar with local customs and works with numerous lenders, seeking out the best loan terms for your particular scenario. Because he has lower overhead, he can offer you lower rates and lower fees than most of the larger lenders.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

May 14th 2012
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Scott Irvine (Scott Irvine)
#7 ranked lender in New Jersey - 15 contributions

David, I have FHA lender who will go below 640, if you want to call me with the full picture I can see what optios you may have. As for the 640 fico requirement vs FHA's FHA set gudielines only they do not directly lend. The lenders put inplace their own more restrictive guideliens to "protect" themsleves.. unfortunately. Scott Irvine845-856-2619.

May 14th 2012
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