What consumers don’t know about mortgages can hurt them

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07/01/2016 | Author: Editorial Staff

When FannieMae recently surveyed consumers about key mortgage qualification criteria, only about half could provide answers. While mortgage rates are low and aspirations of buying a home remain strong, homeownership levels remain low, and a mortgage qualification knowledge gap may be contributing.

Consumers in general and, most importantly, renters who are looking to buy a home in the next five years showed a lack of knowledge about minimum mortgage qualification requirements. Of renters looking to buy within five years, 30% did not know what their minimum required downpayment amount would be, and 45% did not know minimum credit-score requirements. For those who did offer answers to the questions, a significant number overestimated the required downpayment and credit numbers.

Of those surveyed by FannieMae, 50% listed REALTORS® among their three most influential sources of mortgage advice, highlighting the benefit of working with a REALTOR®.

Find more information about the survey in the infographic below and at FannieMae's website.

Infographic from FrannieMae about mortgage qualification criteria knowledge

Categories: Research, Buyers
Tags: buyers, buying, mortgages, mortgage, lending


Rick DeVoss on 07/09/2016

Good morning, Becky!
Please send an email to RickDeVoss at Realtor.com

Becky Wilke on 07/09/2016

Rick DeVoss, I would appreciate information on preparing clients for a loan application.

Rick DeVoss on 07/07/2016

I wonder what percentage of Realtors don’t know the qualifying criteria…?

So many times, in a blog posting on the internet,  I see agents who say that the first thing a buyer should do is “Call a loan officer.”  ~Nothing could be more detrimental to a buyer’s chances of getting approved for a loan, especially a first-time buyer who has no clue what they are doing.

Is this an indication that many agents are just plain lazy, and don’t wish to take the time to consult with a prospective buyer before they send him to the jaws of a lender?
Or is it because many agents have not bothered to educate themselves on how to “pre-qualify” a buyer?

Many times I find people who need to work on their credit reports Before they call a loan officer and let them run the credit score.  (This will lower the FICO score if they are not able to get a loan right away.)  Realtors should not find it that hard to review a credit report, and make suggestions to a client.  ~I don’t charge for this service because I know they will come back to me when they are ready to buy a house. 

Sometimes, there are tricks that a buyer can use to make their loan application look better, and that is a discussion they need to have with their Realtor Before they talk to the loan officer!  (Drop me an email if you want a more detailed answer.)

Being a “Professional” means giving your client the best possible service, and that includes preparation for a loan application.

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