Shaky housing market about to get even shakier

Shaky housing market about to get even shakier

When will we all stop kidding ourselves?

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FICO changes could mean more credit access, MGIC says

More programs available for borrowers on the margin

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FICO scores will ignore debts that have been paid off or settled, and a lesser weight will be assigned to medical bill collections, which account for about half of all unpaid collections on consumers’ credit reports, according to a note from MGIC (MTG).

Details are still being determined and whether lenders accept the changes is not clear yet, but this new scoring model could translate to higher credit scores and better rates for borrowers.

This, in turn, might end up saving them thousands of dollars and making homeownership an even more affordable investment for those right on the edge of good credit.

And in other good news, MGIC reports in their note, there are many options for first-time homebuyers to raise enough money for a down payment.

Low- to moderate-income borrowers need only put 3% down when they qualify for GSE programs like Fannie Mae’s MyCommunityMortgage and Freddie Mac’s Home Possible.

Further good news for borrowers on the margin, down payment assistance programs available from the housing finance agencies are once again picking up steam.

“And borrowers fortunate enough to receive down payment gift funds from parents or family members can finance their homes with conventional, fixed-rate loans,” says MGIC senior marketing program manager Shelley Callaghan.

MGIC also offers a comprehensive Homebuyer Education program on all of this for borrowers and lenders.

All in all, Callaghan says that things are looking up for future homeowners, even if many don’t know about it. 

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