Chase ups minimum credit score, mortgage down payment

Photo by RA Schuetz

FILE – Chase Bank increases its minimum credit rating and down payment requirements. (AP Photo / Frank Franklin II, file)

Frank Franklin II / STF

In the latest effort the lending industry has made to protect yourself from missed payments as unemployment skyrockets, Chase Bank will stop providing loans to homeowners with a credit score of less than 700 and a down payment of less than 20%. The Experian credit bureau calls 670 a “good” score; the average credit score in Texas is a 680.

Chase confirmed the development, first reported by Reuters, to the Houston Chronicle in an email.

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“Due to the economic uncertainty, we are making temporary changes that will allow us to focus more narrowly on serving our existing customers,” said a spokesperson for Chase Home Lending.

The development means that loans are not only becoming more difficult to obtain for those participating in first-time home buying programs through the Federal Housing Administration and the Department of Veterans Affairs, but also for those who are looking for conventional mortgages. The tightening of credit criteria could deal a further blow to a real estate market already affected by the drop in sales during the coronavirus crisis.

The new standards do not apply to existing Chase mortgages or those that qualify for its DreaMaker mortgage, which is designed for low to moderate income individuals.

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