Lenders are Lowering their FICO scores

                          Lenders are Lowering their FICO scores

 

 

FICO stands for Fair Issac and Company.

FICO provides analytics and decision making services which includes credit scoring, it measures the credit risk of an individual and report them to the 3 credit bureaus which are: Equifax, Experian, and Transunion

 

It appears that the market is bouncing back, higher sale volumes and now more banks are lowering minimum FICO score requirements. By lowering the FICO score, it should assist underserved borrow to hopefully purchase a home

I just read yesterday Carrington Mortgage Services  lowered its minimum FICO score to 550.

Wells Fargo, the nation’s largest mortgage lender, said in February that it was lowering its minimum FICO score requirements on FHA-backed mortgages from 640 to 600.

According to Carrington, one in three consumers has a FICO score below 650. Saying that, I believe it’s a great ideal to reach out to those consumers with lower scores just they a lower does not mean they can not pay their mortgage.   I’m certain the lenders  will factor other conditions  other tha just the FICO score to determine a prospective buyer will qualify. According to Carrington, which says it’s refocusing its business on the underserved segment and eliminating conventional and jumbo loans. In addition to accepting more lower-score borrowers, it’s also limiting its acceptance of wholesale submissions with FICO scores above 680 starting April 1, except for VA loans, HousingWire reports.

Ray Brousseau, executive vice president of Carrington’s mortgage lending division.  states“Effectively meeting the needs of clients in the underserved market requires the ability to both originate quality loans and appropriately service them after the fact with them.”

This new initiative will give the market a good boost, although the sales volume has picked up, there is still ahugh inventory of vacant and distressed homes out there..

Source: “Carrington Ups Ante on Wells Fargo by Lowering FICO Standard,” HousingWire (March 24, 2014

Please feel free to call or email with any questions or concerns regarding your real estate needs.

 

Ainsley Daux

Florida Realty

(813)546-1954

902 w Lumsden rd

Brandon, FL. 33511

I serve the Tampa Bay Area