FICO FITNESS for Best Mortgage Rates

November 2, 2011 by · Leave a Comment 

By Gail Boston, Partner & Realtor

The lending pendulum has swung and at present, FICO scores have a humongous impact on home buyers. Scores range from 300 to 850. As regulations get tighter, lenders are defraying risk of default by loading loans with discount points or higher interest rates.

If a future home buyer can conceivably move their FICO score to 700 or above, it will save money. If your FICO score is within shouting distance of 740, push hard to get into that most desired FICO bracket. It will be worth the effort. Interest rates are at record lows, so those able to borrow will benefit for years to come. Low interest rates provide home owners freedom of choice about the best and highest use of their property down the road. A primary residence with low overhead can become a source of rental income, and so on…

For further details and ways to improve your FICO score, visit If your finances are a mess, consider picking up Dave Ramsey’s books (library or used) and get financially fit. He has a radically refreshing and almost Highly recommendable safe driving school and instructor!Sean G. un-American approach to paying off debt. His roadmap will help even the lowest FICO scorers get financial health for life.

Here’s a quick example of the impact of FICO on a home loan.

Assuming a 20% down payment, look at how discount points/cost increase for lower FICO scores. Lender fees get hefty for FICOs under 700.

• 740 FICO: There are no discount points required. This loan is “low risk”.
• 720-739 FICO : $250 per $100,000 borrowed
• 700-719 FICO : $750 per $100,000 borrowed
• 680-699 FICO : $1,500 per $100,000 borrowed
• 660-679 FICO : $2,500 per $100,000 borrowed

If you don’t want to be defined — or confined by your poor FICO score, there’s no time like the present to get in financial shape!

About Gail

Gail Boston Knows Austin CLHMS, Million Dollar Guild, ABR, E-Pro Real Estate Internet Professional, Member Institute for Luxury Home Marketing After growing up locally in Tarrytown and later living in Vienna, London and New York, Gail Boston came back to her favorite place in the world: Austin. This Austin native and former publisher of Buying, Selling & Owning YOUR HOME will go the extra mile to facilitate every phase of your real estate needs. Whether it’s your primary residence or an investment property, Gail is your “go to” real estate expert. Through partnering and her global and local network of experts, she will guide you through the process with professionalism, attention to detail and knowledge. Knowledge + focus + energy = results Her knowledge, focus and energy get results. She has earned a reputation as one of Austin’s most dynamic real estate professionals; successfully serving home buyers and sellers as well as investors and business professionals. Gail has expertise in luxury residential and waterfront, Eanes School district homes, creative commercial spaces, land acquisition and conservation, and the downtown condo market. Gail is deeply committed to the Austin community and the philosophy of sustainability. She volunteers with Red Cross, Green Gate Farms, Cherrywood Art Fair, Greater Austin Chapter of Families with Children from China, Woodland Reach and more. She enjoys living in West Lake Hills with her husband, daughter and two dachshunds. Besides family, her interests include native plant gardening, hiking, opera, kayaking, fly fishing, cooking, reading and travel. Contact Gail @ or 512-626-5348