Many Renters Are More Mortgage-Ready Than They Realize: Here’s How to Know
Many renters might not realize they are in a financial position to buy a home. According to Zillow, millions of renter households in 2022 could have afforded to buy a house that year. Despite this, a significant number of renters remain unaware of their potential mortgage readiness. Are You Ready to Buy a Home? 1. There’s ‘No Harm’ in Checking Your Credit Understanding your buying power starts with knowing your credit situation. Some renters might be apprehensive about checking their credit, fearing it could negatively impact their score. However, soft credit verifications can provide a clear picture of your credit without affecting your score. A strong credit score can result in lower interest rates on a mortgage, while a lower score might lead to higher rates or difficulty securing a loan. Monitoring and improving your credit score over several months can significantly enhance your mortgage readiness. 2. Debt-to-Income Ratio Your debt-to-income (DTI) ratio is crucial in determin...
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