They require a 3 percent minimum down payment, have interest rates varying
by borrower credit score and loan term, and mortgage insurance premiums set by loan - to - value.
This can be anything from
low borrower credit scores or too much borrower debt, to the borrower's properties not producing a sufficient enough income.
Starting Jan. 1 next year, mortgage lenders will be required to
give borrowers credit score alerts on how their credit scores might be preventing them from getting good mortgage rates.
Even FHA (Federal Housing Administration) loans, which have traditionally catered to borrowers with lower FICO scores, have an
average borrower credit score of 693, according to CNN Money, which is above the national average.
The rapid increase in FHA insured mortgage loans is evidently perceived as a threat to MGIC, the nation; s largest insurer of conventional mortgage loans; the company has unveiled a plan for charging lower premium costs based
on borrower credit scores.
And at Santander Consumer USA, a Dallas - based subprime auto lender,
average borrower credit scores were higher as of March 31 than they were a year earlier.
«For most origination years, requirements for
borrower credit score and loan - to - value ratio are the factors that most reduce the ever -90-day delinquency rate of mortgages acquired by the Enterprises that would have met the proposed QRM standards.»
As mentioned,
borrower credit scores must be at least 720, or 690 with a cosigner.
Borrower credit score, down payment, loan term and loan type are the primary attributes that affect our rates.
Our assumptions in studying these title insurance fees included a down payment of 20 % and
a borrower credit score of 740 on a $ 200,000 home purchase in California.
Although the federal report didn't specifically request that they provide more data, Fannie Mae and Freddie Mac said they would follow recommendations to provide more information about downpayment size, whether loans were to buy homes or to refinance an existing mortgage, and
borrower credit scores.