When the time comes to purchase your first home, there are many factors of your life that play into how much home you can afford. While it makes perfect sense that a lender would need to make sure that you actually have a steady income before choosing to loan you large amounts of money, why does your credit score matter so much?

Many people think that as long as I make enough to pay the mortgage why should they care what mistakes I made in my past. Evaluation of credit isn’t just used to determine what kind of bill payer you are. It is actually used to determine many factors in your mortgage and the terms you will receive.

Your credit shows your previous patterns of making agreed upon payments on your previous debts. If you have a good track record of making your payments on time, it will reflect positively on you as a loan candidate, which reflects on your credit score.

Debt to income is taken into account in your score. Did you know that being close to the credit limits on your accounts, even if you are paying on time, affects your score negatively? Did you know that in 2016 the #1 reason prospective buyers were denied on a home loan was their debt to income and not their credit score overall? Speak with a professional to decide which debts to pay down first to get the biggest return.

While it may seem frustrating to be told you should wait to buy a home, your lender may actually be looking out for your best interests. Veritas Funding loan officers can coach you through ways to improve your credit so that you will be able to save big on purchasing your home. Don’t be discouraged if you have to wait a few months because it will save you money in the long run. If you want to talk to a loan professional and see what your home purchasing options are click here.