interest rates and credit scores?

Question

my ma is just now getting on her feet and paying her bills off after she was laid off this was bout 6 years ago when are house was foreclosed but i was wondering how long she would want to wait before she tried to get another loan for another house we really want to move and start over but i was wondering what kind of interest rates she would have with a credit score 540 or 555 not sure which one but both are close and if you could explain what an interest rate is thank you

Answer 1

For buying a house Credit History is much more important than credit score. Often, the lack of credit history is equated with bad credit. You should be aware that lenders will go through your credit report once you apply for loan for buying a house. Therefore you should polish your credit report. Anyway, in order to establish a good credit history and at the same time risen your credit score in a short time do following things:

1) Close all of your credit cards but one. It reflects in your credit report and it is a very good sign. For instance say that you have 5 credit cards with $1000 credit limit for each. Therefore you are responsible for $5000 of possible debt. But when you close 4 of them, now you are only responsible for $1000 of debt which lowers the level of risk of lending money to you.

2) If you have any loan, like car loan or any balance on your credit cards, try to pay more than your monthly payment for 6 months or something. I mean say your monthly due on your car loan is $150, try to pay $250 each month. Lenders can see these trends in your credit report and they see that you’re a responsible borrower.
If you don’t have such loans, I suggest getting a $3000-$4000 loan and paying it off in full in 5-6 months. You might pay $200-$300 of interest but you will save thousands of dollars in your home mortgage and interest rates.

Also checkout http://www.howtoestablishgoodcredit.com/Credit_Articles/index.php
There are lots of articles there, related to your question, which you can find useful to boost your credit.

Answer 2

If your mom has reestablished credit she may qualify for FHA financing with a minimum down payment as FHA is not score driven although score is a consideration.

The interest rate is the amount in addition to the loan balance that is repaid on the loan over the term of the loan.

Answer 3

i can not tell you the interest rate but the middle fico score is too low , the lowest one thet the lenders like for good rates is 580, and for sure it depends on the money you 'll put down for the house, and from your income ....

Answer 4

it depends i work with a company that can go as low as a 500 credit score. send me an email if you want more help.