Most homes and condominiums are financed through conventional loans from a bank. Individuals or families apply and their financial history is evaluated to determine whether or not they are a wise investment. If the bank approves, it offers a loan reflecting its confidence, and the consumer is free to either accept, walk away or come back with a counter-offer.
Because there is no overarching authority, the requirements for securing a mortgage vary wildly from institution to institution. Common wisdom is that the bare minimum credit score for conventional loans is 650, though many banks require at least 700. There must also be a demonstrable income and a sufficient down payment: the lower the former two, the more of the latter will be needed. Houses should have at least 5 percent down, while condominiums need at least 10.
The interest rate offered by a bank depends on the credit of the applicant. This rate is what makes all the difference in the total cost of a home, which is why it’s so important to compare rates between various vendors before making any commitments. Shopping around can be time-consuming, and many banks will refuse to negotiate with applicants. Common Sense Mortgage Group, Inc. mortgage brokers, on the other hand, are skilled at catching the ears of lenders and can end up saving you tens of thousands of dollars in interest payments over the life of a loan.