Smaller, consistent monthly payments often provide a slightly greater interest savings over time because the principal is reduced continuously. However, a lump-sum payment (e.g., from a tax refund or bonus) is also highly effective and can be easier to manage for some borrowers.
You have several options to check your score without paying:
Your Credit Card Statement: Many credit card companies now provide a free FICO® or VantageScore® as a cardholder benefit.
Your Bank or Credit Union: Online banking portals often offer free credit score access to their customers.
Non-Profit Credit Counselors: HUD-approved agencies can help you access your reports and scores.
Free Online Services: Websites like Credit Karma or Credit Sesame provide free VantageScores, which are good for monitoring but note that most lenders use FICO® for mortgages.
You’ll need to provide bank or investment account statements showing you have sufficient funds. Any large, recent deposits will need to be sourced with a paper trail (e.g., a copy of a bonus check, a gift letter if it’s a gift, or a sales contract from a sold asset).
On average, buyers pay between 2% and 5% of the home’s purchase price in closing costs. For a $400,000 home, this translates to roughly $8,000 to $20,000. The exact amount varies by location, loan type, and lender.
Common reasons for denial include:
Insufficient Income: Your income is too low to support the mortgage payment.
High Debt-to-Income (DTI) Ratio: Your existing debts are too high relative to your income.
Poor Credit History: Low credit score, recent late payments, collections, or a bankruptcy/foreclosure.
Low Appraisal: The property isn’t worth the loan amount.
Unstable Employment: Gaps in employment or an inability to verify stable income.
