Some sellers do not take the steps to check their credit rating, therefore are faced with higher mortgage rates and additional costs when arranging financing on their new home loan.
Before selling and buying a new home, sellers should repair any negatives on their credit report.
You can get a mortgage with strong credit and the minimal level required to qualify. With poor credit you will pay higher interest rates.
A 30 year mortgage of $150,000 based on an interest rate of about 5.75%, the payments will be in the range of $870 per month. Compare this to someone buying a home with bad credit. They will pay over 9% interest which makes a payment that exceeds $1,200 monthly. The difference could pay for a second home over the course of the mortgage.
Those with good credit can buy the home of their dreams or an additional property.
If you are selling a home now or in the future, contact Equifax or TransUnion for a copy of your credit report. Take steps to repair any problems, then apply for a mortgage.
Learn more about our Durham Region Real Estate for sale by owner website.
