Low Credit Score Means Higher Interest Rate

Added September 27, 2007 by Ilyce R. Glink

Print Articles

Summary: A low credit score will lead to challenges when trying to get a home loan. The interest rate will depend on what kind of credit you're looking for. It's also possibly that you won't qualify for a loan with a credit score of 500.

Q: What interest rate will a credit score in the mid 500s get?

A: It depends on what kind of credit you're looking for. According to www.MyFico.com, if you have a credit score of 760 to 850, and you're looking for a 30-year fixed rate mortgage, you'll be able to get interest rates of approximately 6.1 percent. That's the highest tier for credit.

But if your credit score is 500 to 579, which is the bottom tier, and well into the subprime world, the same loan would cost you 10.43 percent -- if you can even get it. Many of the subprime lenders have been raising the minimum credit score required for loans.

Bear in mind, it's entirely possible that you wouldn't be able to qualify for a loan with a credit score of 500.

See more articles on this topic by clicking on the "RELATED ARTICLES" above and to the right.

We have over 5000 articles on Real Estate Advice, Personal Finance Advice and Consumer Advice on our site. We encourage you to look at these articles. As always, if you have a comment on our articles, don't forget to post your comment below. We thank you for coming to ThinkGlink.com.

© Ilyce R. Glink. All rights reserved. This content may not be used, distributed, syndicated, compiled or excerpted in any medium or form without written authorization from Think Glink, Inc. For information on syndicating ThinkGlink.com please contact us.

Previous article Next article