Anonymous asked in Business & FinanceRenting & Real Estate · 1 month ago

Do you still need excellent credit if you are selling a home to buy another one?

I have made upgrades to my  home . It was gutted and made brand new inside. I am thinking about relocating once this is done. They said the value of the house will go up now.

Only thing that I worry about is since owning my credit score has dropped.

Any real serious advice

8 Answers

  • The short answer is yes.  You don't need to be a genius to figure out that if evictions and foreclosures spike (which is a certainty) that banks will be cautious about loaning money.  

    I'd also be willing to explain why your credit score has dropped and what's dragging it down.  Look at your credit debt to available credit ratio, debt to income ratio, and changes in income.

  • 1 month ago

    Bottom line: You always need good credit when buying a home, even if you own a home now. You don't say what caused the credit score drop--so that's about all the advice anyone can give you. Yes, you'll need good credit. Unless you pay cash. 

  • 1 month ago

    If you need financing to buy the next house, you need either good credit or a large enough down payment to convince a lender they're not taking a great risk.  50% down ought to do it, though you might not get the best interest rate.  20% or less down, it's going to depend on HOW much your credit rating has deteriorated.  If your score is 700+ and you have no derogatory marks, with 20% down you would sail right through and with less than 20% down and PMI required, your chances are still good.

  • Anonymous
    1 month ago

    You need decent credit to get any home loan. It depends on how far your score has dropped. If its below 620ish, forget it.

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  • 1 month ago

    Yes, unless you plan to play the full price of the new home when you purchase it.  To get a mortgage, the bank/lender has to be confident that you can repay the load. They base that decision and determine your interest rate on your current income, your assets, and your credit score.  

    You'd be wise to work on fixing or improving your credit score by paying off any credit card or other loans you have.

  • 1 month ago

    if you need a mortgage

  • 1 month ago

    Only if you are borrowing money and want lower interest rates

  • A
    Lv 7
    1 month ago

    your credit score is going to affect you if you will be taking out a mortgage.   Unless you have enough equity to buy a house for what you get from the sale, it is going to increase the interest rate on a new loan or prevent you from getting one.  You should work right now to improve your credit,  pay off CC, don't take on any new debt, never carry a balance, pay in full each month.  If you are in a lot of debt it may make sense to increase your income to pay down debt

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