What consumers don’t know about mortgages can hurt them

Translate this page
Three flat-looking red houses with black outlines with the text: $, %, and TAX

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.

Leave a Comment

Read our commenting policy

advertise with us

Legal disclaimer

The material provided here is for informational purposes only and is not intended and should not be considered as legal advice for your particular matter. You should contact your attorney to obtain advice with respect to any particular issue or problem. Applicability of the legal principles discussed in this material may differ substantially in individual situations.

While the Texas Association of REALTORS® has used reasonable efforts in collecting and preparing materials included here, due to the rapidly changing nature of the real estate marketplace and the law, and our reliance on information provided by outside sources, the Texas Association of REALTORS® makes no representation, warranty, or guarantee of the accuracy or reliability of any information provided here or elsewhere on texasrealestate.com. Any legal or other information found here, on texasrealestate.com, or at other sites to which we link, should be verified before it is relied upon.

Advice for REALTORS®

When and how to disclose agency

How Texas REALTORS® are preparing to lead in 2017

What you need to know about advertising rules

Luxury home sales remain strong in 2016


More advice for REALTORS®