Home Base
Home Base with Marc Emrich
Buying your first home in Colorado is one of the biggest decisions you'll ever make — and most people start with more questions than answers. Home Base is here to change that.
Each week, mortgage broker Marc Emrich of Pivot Lending Group sits down to answer the real questions first-time buyers are asking: How much do I need for a down payment? What does my credit score actually mean for my loan options? What is a forgivable loan — and how is it different from a grant? What happens at closing?
No jargon. No pressure. Just clear, honest answers from a Colorado mortgage professional who helps buyers navigate the path to homeownership every day.
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Home Base
Credit Score Requirements for First-Time Buyers in Colorado
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Welcome to Home Base, the podcast that helps first-time homebuyers understand the road to owning their own home. I am your host, Lauren, and every week I'm joined by Mark Emmerich, Senior Loan Originator at Pivot Lending Group. Let us get into it. Mark, welcome back. Always good to have you in the chair.
SPEAKER_00Thanks, Lauren. Glad to be here. It's a good week to be talking mortgages.
SPEAKER_01Today, we're getting into credit scores. Specifically, what first-time buyers in Colorado actually need to qualify for a mortgage? Because I think a lot of people assume their score has to be perfect, and that stops them from even starting the conversation. So let's just start there. What does a first-time buyer actually need score-wise to get a mortgage?
SPEAKER_00The short answer is probably less than they think. FHA loans, which are really popular with first-time buyers, can accept scores as low as 580 with a 3.5% down payment. Conventional loans generally want to see a 620 or above, though that can vary by lender. The point is, these minimums exist, and there's real room in there for buyers who don't have a pristine credit history.
SPEAKER_01That's really reassuring, actually. But I'm guessing a higher score still matters, even if you clear the minimum.
SPEAKER_00When you translate a slightly higher rate across a 30-year loan, the difference in total interest paid can be really significant. So clearing the minimum gets you in the door, but improving your score before you apply can save you real money over time.
SPEAKER_01Can you give me a sense of what that actually looks like in practice?
SPEAKER_00Sure. Think about two buyers taking out the same loan. One has a 740 score, one has a 680. The buyer with the 740 is likely going to receive a noticeably better rate. That gap in monthly payment might not sound dramatic at first, but compounded over 30 years, it adds up to a meaningful difference in what you actually pay for that home. It's one of the best reasons to give yourself a little runway before you apply if your score has room to grow.
SPEAKER_01Okay, so let's say someone's listening and they know their score needs some work. What can they actually do to move the needle?
SPEAKER_00A few things can help, and some of them work faster than you might expect. Paying down credit card balances, especially cards that are close to their limit, can raise your score within one or two billing cycles. Making all your payments on time is essential. That's the foundation. And in the months leading up to your mortgage application, you want to avoid opening new credit accounts because those new inquiries can temporarily pull your score down.
SPEAKER_01Wait, inquiries lower your score? So does that mean just checking my credit hurts me?
SPEAKER_00No, and this is a really common misconception worth clearing up. Checking your own credit is called a soft inquiry, and it has no effect on your score at all. What affects your score is a hard inquiry. That's when a lender pulls your credit as part of a loan application. Even then, the impact is usually small and temporary.
SPEAKER_01So what about shopping around with multiple lenders? Doesn't that mean multiple hard inquiries?
SPEAKER_00It would seem that way, but the credit bureaus have built in a protection for rate shoppers. If you're applying with multiple mortgage lenders within a short window, typically somewhere in the range of 14 to 45 days, depending on the scoring model, those inquiries are usually treated as a single inquiry. So you can shop for the best rate without your score taking hit after hit. A mortgage professional can walk you through exactly how to approach that so you're being smart about it.
SPEAKER_01That is genuinely news to me, and I think it'll be news to a lot of listeners. What about getting pre-approved? Does that trigger one of these hard inquiries?
SPEAKER_00It does, yes. A pre-approval requires a lender to pull your credit, so there will be a hard inquiry involved. But as we just talked about, if you're doing this with multiple lenders in a short period, they're typically counted together. And the small temporary dip from a hard inquiry is really minor compared to the value of actually knowing where you stand and what you can borrow.
SPEAKER_01So the message is don't be afraid to check your own credit. Don't be afraid to shop around, and don't assume your score has to be perfect before you start.
SPEAKER_00Exactly. And I'd add one more thing: don't try to figure all this out alone. A mortgage professional can actually pull your credit report and go through it with you, identify what's having the biggest impact, and suggest the most efficient path to improvement for your specific situation. It's not a one-size-fits-all answer, and having that guidance can make a real difference in how quickly you get where you need to be.
SPEAKER_01If someone's walking away from this episode with one thing, what do you want it to be?
SPEAKER_00Don't let an imperfect credit score stop you from starting the conversation. Minimums are lower than most people expect, and even modest improvements before you apply can save you thousands of dollars over the life of your loan. Find out where you stand. That's always step one.
SPEAKER_01Mark, thank you. This was one of those episodes I think a lot of people needed to hear. We'll see you back here next week on Home Base. That's it for this week's Home Base. If you want to learn more about home buyer programs and resources, visit co first time buyergrants.com. You'll find everything in English and Spanish. We're back next week. Thanks for listening.