The second most common barrier to homeownership is the lack of access to credit due to a person's low credit score. The credit score is the lender's measure of one's credit risk, and a higher score means that the leader can be more confident that they'll be paid back.
FICO Credit Score Range
Excellent - 750 to 850
Good - 700 to 749
Fair - 640 to 699
Poor - 580 to 639
Bad - 360 to 579
In order to qualify for a mortgage, most lenders will require each borrower to have at least a fair credit score (640+). There are other programs that will allow borrowers with poor credit to buy a house, however, these programs typically require borrowers to go through homeownership classes and the homes will be subject to extra inspections and/or appraisals.
Where Do I Find My Credit Score?
Some credit reporting agencies will give you your FICO credit score for free and some will charge you a fee. The three major credit reporting agencies are:
TransUnion
Equifax
Experian
CreditKarma.com will show you your Vantage Score 3.0 for free. It's a great resource for credit repair and maintenance too. The Vantage Score 3.0 is often higher than your FICO score so be prepared if you find out that your FICO score is lower than expected.
If you find out that your score is lower than expected, use Credit Karma to help you understand and improve your score or read our article about improving your credit score over here.