Low Credit Scores Holding Back Housing Recovery

Interest rates are still near historic lows, home pricing remains affordable, and the economy is turning around - yet mortgage originations remain low.  Home ownership remains out of reach for nearly a third of Americans. 

Why?  Nearly 30% of America has a credit score below 620.  Of these, most have likely been unable to receive even one offer from a bank - even when offering 15-20% down.

How did we get here?

Layoffs, salary decreases, and adjustable interest rates among other things pinched the consumers pocketbook.  Payments were missed, delayed, or completely abandoned - leaving many people with less than desirable scores.  Bankruptcy filings also spiked despite the strict changes in filing rules a few years back.

Where do we go from here?

Increasingly, lenders are willing to “take a chance”, and loan originations are slowly ticking upward.  Also, as people pay down their debt, their scores are ticking upward
while their monthly payment burden goes down.  Those who do have credit issues may have to start small, but there are options. Start with a pre-paid credit card to build credit.  As that score increases, so do the options.  Contact a reputable credit counselor for more suggestions and options.

About the Author:
Michael Blount Jr is a Realtor and the Broker of Blount Properties, living in The Woodlands, TX.  Michael is knowledgeable in both residential and commercial real estate and studies the market and trends to better serve his clients.  Michael serves the greater Houston metro area.  For more information - visit www.BlountUSA.com or search for Blount Properties on FaceBook.