How Credit Scores, Down Payments, and Mortgage Rates Impact You
Since your credit score is tied directly to the ability to get a home loan and the interest rate the loan will be at, you will want to make sure you have a strong credit score. Unpaid debt, late payments, default, and lack of credit can all impact your score. Your lender can tell you what your score is and can advise you on how to improve it if it is less than ideal.
Most lenders require a minimum down payment of at least 3.5% of the sale price. Do you have that money? If not, now may not be the best time for you to buy. Check with a lender to find out how much of a down payment they require. In some cases, such as a first time VA loan, there is no down payment required.
Finally, check out mortgage rates. You will want to shop around for the best rates available. The long-term mortgage rates have dropped in the past few years and have remained low. If the timing is right for you financially and your credit is in good shape, you may want to take advantage of current mortgage rates.