Starting November 1st, getting a mortgage loan may have become a little more difficult for some homebuyers; government-backed Fannie Mae has tightened their lending standards. The required scores for good credit are rising.

A credit score (FICO) is a number representing the likelihood that a person will pay his or her debts.  Depending on the type of loan, anybody with a credit score of less than 620 will have a hard time getting a mortgage. According to Charles Capone, PhD Senior Analyst at the U.S. Congressional Budget Office, the mortgage market views a FICO score of 620 as the bottom cut off for prime loans.

To get the best rates, you will need to have a score of about 720 as well as a steady income. People with scores above 720 are considered low risk borrowers.  To check out your credit score, you can go to www.annualcreditreport.com.

Here are the current rates with Private Mortgage Advisors (Wells Fargo affiliate) as of 11/16/09:

• Non-conforming (greater than $729,750) 30-year fixed = 5.75%
• High Balance Conforming ($417 K to $729.75 K) = 5.125%
• Conforming Loans ($417 K and under) = 4.875%

Even though it may be more difficult to get a mortgage, interest rates are currently very low, so it is a good time to be a homebuyer.  With low mortgage rates and federal incentives for buyers, you or somebody you know may be thinking about buying a new home or refinancing your current home. 

My business is based on referrals from friends like you.  Please call me if you hear of somebody who is thinking about making a move now or to represent your interests in a real estate purchase or sale in Saratoga, Los Gatos, Monte Sereno and surrounding Silicon Valley communities.

Rick Bonetti | Alain Pinel Realtors | 408-857-8800