Are low-income households more likely to have low credit scores?
No – – A low-income buyer is as likely to have a high credit score as a high income home buyer. An individual’s management of credit, as measured by a credit score, has little correlation with that individuals income. What’s the relationship between down payment and credit risk? Looking at down payment as the primary risk factor overstates the real credit risk of many home buyers. Those who make only a 5% down payment but have a high credit score ( say, over 740) are LESS likely to default than those who put 30% down but have a credit score under 620. Does a lender have to show an applicant his/her credit score? NO – – There is no legal requirement for the lender to reveal a credit score to an applicant. But if the application is denied, the lender must reveal the reason(s) for that denial. What if the credit report contains errors? Individuals should contact the credit repository to report errors. Under the Fair Credit Reporting Act, 30-day resolution is now required. Lesson: Always o
