 TITLE: Do I Need Good Credit to Buy a Fixer Upper? CONTENT: How Your Credit Impacts Getting a Mortgage\n------------------------------------------\nGenerally speaking, the higher your credit score, the better your choices will be when shopping for a home loan. A higher credit score is more likely to win you a loan approval; it also typically earns you a lower interest rate.\nThat being said, the minimum credit score requirements for the government-backed renovation loans listed above are not astronomical. Some are even designed for homebuyers who might not have the credit score to qualify for a traditional mortgage. For instance, with a 10% down payment, the minimum credit score for an FHA loan is 500—or 580 if your down payment is less than 10%. Credit score requirements for VA loans vary by lender, but typically a \"good\" score of 670 is a reasonable starting place. Fannie Mae and Freddie Mac loans have a minimum credit score of 620, but higher scores make it easier to qualify and are all but essential if your down payment is below 20% to 25%. Check with your individual lender for their requirements.\nHaving a sufficient credit score is only one factor in getting your home loan approved. Lenders will also look at your debt-to-income ratio to make sure your income is adequate to cover your outstanding payments. Although 100% financing may be available for your fixer upper, having a down payment will open the door to more funding options. A larger down payment of 20% or more will not only make it easier to qualify for a loan, but may also lower your interest rate. Finally, lenders also want to know that you have resources to fall back on if your income is disrupted, so savings and investments are a help.\nJust as lenders will evaluate your application, you'll need to evaluate which loan works best for you. Renovation loans come with a host of restrictions and requirements. Because of the complexity and additional risk that a fixer upper represents, it may help to work with a knowledgeable mortgage broker or loan officer who can help guide you through the financing process. END