Potential Homebuyers With High Incomes Still Worry About Credit Scores

Even those with the funds to secure jumbo mortgages may find that their low credit hurts them

Potential Homebuyers With High Incomes Still Worry About Credit Scores
May 13, 2016

According to a survey done by Experian in February 2016, even homebuyers who make more than $100,000 a year are concerned that their credit scores are not high enough to get good rates.

Forty percent of the 500 respondents to the survey stated that they worried about their score, while 29 percent stated that they were actively trying to improve their scores in order to get better rates. All participants in the survey had recently purchased or were planning to purchase a home within the next year.

Many who make over $100,000 a year, seek to purchase homes that cost more than $417,000. This means they must qualify for a jumbo mortgage, which has some different qualifications from conventional mortgages. The first is that those with a credit score under 680 are likely to be rejected unless they can provide a good reason for their low score and show that they have the financial resources to pay their monthly mortgage payments. Generally, to get the best rates for a jumbo mortgage, the borrower needs to have a credit score of no less than 720.

Experian’s Manager of Public Relations and Customer Education, Sandra Bernardo, points out that many high-income borrowers never think to check their credit score. Many assume that their income and the fact that they pay off high balances regularly means their credit scores are good, but lenders also look at how borrowers manage their credit and their debt-to-credit ratio

You can check your credit score and read your credit report for free within minutes using Credit Manager by MoneyTips.

Photo ©iStockphoto.com/NorthernStock

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irene | 05.13.16 @ 14:54
I think nearly everyone saw a bit of a credit score drop during the recession. I know ours went down a bit because I had to use the credit cards a lot and could only make minimum payments for a while
Sara | 05.13.16 @ 14:55
Glad to see that credit does not just hurt the little guy persay. however, I am not honestly surprised I have learned that credit is a big thing.
trish | 05.13.16 @ 14:55
I want to check my credit score...I always worry about what could be happening on there! You hear so many stories.
Nancy | 05.13.16 @ 14:55
Interesting findings. I tend to think of higher income people having good credit. I guess we're all human.
Erin | 05.13.16 @ 14:56
This is something we were concerned about when we bought our house. We were fairly young and hadn't really had much time to build up our credit score. There are so many little potential pitfalls that make the whole home-buying process nerve-wracking.
Carla | 05.13.16 @ 14:56
I don't think you ever stop worrying about your credit scores. It pays to stay on top of them no matter how much you earn.
Jonathan | 05.13.16 @ 14:57
This day and time you can't afford not to.
Steffanie | 05.13.16 @ 14:57
Credit scores are always something we worry about. It has such an impact on everything we do.
STOKES | 05.13.16 @ 14:58
You should always be vigilant about your credit score. I love my credit card that let's me check mine monthly.
$commenter.renderDisplayableName() | 01.27.21 @ 01:57