Frequently Asked Questions
7/24/2020 Meant for informational purposes only. Subject to change without notice Page 1 of 6
There are normally many questions that homebuyers will have before, during and after the
homebuying process. Below are frequent questions and answers to homebuyers' most
frequently asked questions:
Credit
• Is owning less expensive than renting?
a. WHEDA recommends comparing the pros and cons of homeownership versus
renting. Click on the following link to review “Renting vs. Owning” “The True
Cost of homeownership” to give you some insight into the differences.
• Does my credit score impact my ability to buy?
a. Yes. The type of loan you get, including interest rate and points paid, is primarily
determined by your credit score. The type of loan you get, including interest
rate, is primarily determined by your credit score, also known as a FICO score. It
is a good idea to get a copy of your credit report and learn how to read and
understand it. Annualcreditreport.com is a great resource for both tasks! Your
credit score is a combination of five different criteria, each of which makes up a
percentage of your score. Scores range from a low of 300 to a high of 850.
b. You will need a credit score high enough for the WHEDA program you are
applying for. The minimum credit score requirements for WHEDA Advantage
Conventional is 620, and for WHEDA Advantage FHA it is 640. If your current
credit score does not meet the minimum thresholds, it is a good idea to work
with a Homeownership Counseling Agency to take steps to repair your credit,
develop better habits and ultimately increase your credit score. A
Homeownership Counseling Agency will work with you to make any necessary
credit repair. When you are ready, you can find a WHEDA lender for the next
steps.
• I have 3 different credit scores from the three different credit bureaus (Equifax,
Transunion and Experian) which score will my lender use?
a. The lender will go with the middle score. In the event that there are just two
credit scores, the lender will go with the lesser of the two scores.
• What is the difference between a soft inquiry and a hard inquiry on my credit report?
a. Soft inquiries are pulled on your credit when you receive a credit card offer in
the mail, when a potential employer performs a background check, or when
YOU check your credit. While soft inquiries do appear on your credit report, only
you can see them (with a few exceptions). They do not adversely affect your
credit score.
b. Hard inquiries are performed when you apply for a loan, credit card, or
mortgage and the lender checks your credit history before granting (or
denying) the loan. Hard inquiries stay on your credit report for two years, and