Personal finances improve, consumers could gain confidence to buy homes

As an indicator of recent economic gains and improvements of consumers' personal finances, a growing number of potential mortgage borrowers now had near-perfect FICO scores.

As an indicator of recent economic gains and improvements of consumers' personal finances, a growing number of potential mortgage borrowers now had near-perfect FICO scores.

According to a recent survey from FICO Labs, roughly 18.3 percent of consumers now have a score between 800 and 850. This is the highest the share has been since October 2008. With a higher FICO score, borrowers may now have the financial safety and soundness to qualify for more favorable and affordable terms for the home loans.  

"There has been a clear shift," said Rachel Bell of FICO Labs. "Many consumers have moved into the top tier of the FICO Score range by redoubling their efforts to maintain an excellent credit profile." 

However, Bell noted that while some consumers have managed to improve their finances during uncertain economic times, others have struggled. It was found that currently 31.9 percent of consumer have a FICO score between 550 and 699, while 14.9 percent have a score between 300-549. Despite a notable share of consumers in the lowest tier, the report indicated that this is the smallest the share has been since 2006.



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