A recent survey helps illustrate how poor credit scores and other financial problems are affecting the housing market while keeping people from meeting their long-term goals.
According to the poll from the National Association of Home Builders, 39 percent of people who currently rent say they would like to buy their own home, but simply lack the money to do so. Another 20 percent said that they lack the credit score and other qualifications needed to qualify for a mortgage loan, while 18 percent indicated that job security is their biggest difficulty when it comes to planning a home purchase.
The current economic climate has produced a situation where only those with the highest credit scores can typically expect to secure a mortgage - especially at favorable interest rates that could save hundreds of dollars each month.
With that in mind, anyone who does have ambitions of buying a home in the foreseeable future should be strongly focused on building up the strongest credit score possible. A good place to start is to keep track of one's credit report.
The fastest way to ruin a credit score is to miss monthly payments on credit cards and other debts. People who max out their credit cards will also inflict some noticeable damage to their credit score, while another thing to avoid in the months leading up to a mortgage application is a decision to close down old credit accounts. This is because the length of one's credit history is another factor in calculating one's score.
Of course, high credit scores can be painfully elusive for many people in the current economy, with nearly 10 percent of the nation's workers still unemployed and seeing little relief in sight.
Also, with prospective homebuyers struggling to meet their financial goals, current property owners are also paying the price in the form of houses that are far more difficult to sell.
For example, the NAHB poll found that 29 percent of current homeowners said the biggest obstacle to buying a new house is their inability to sell the one they currently own. Another 7 percent said underwater mortgages were holding them back, while 14 percent said they were worried that home values would fall even further after they made a purchase.