Many consumers misunderstand what is required to obtain a residential mortgage, according to a new Fannie Mae study.
A significant number of consumers polled by Fannie Mae this summer did not know what is required for a minimum down payment on a home; required minimum credit scores for obtaining a mortgage; or an acceptable range for debt-to-income ratios.
For those survey respondents who provided an answer, their responses were largely off-base, further demonstrating that consumers do not know the basic financial criteria for obtaining a mortgage.
The lack of knowledge applied to both consumers in general, and to renters. Fannie Mae polled renters with the idea that that group would be interested in eventually buying a home.
Lenders are an important source of accurate information for potential homebuyers, Fannie Mae said.
"Lenders are in a vital position to help close consumers' knowledge gap of what is required in today's mortgage market to successfully obtain mortgage credit," Mark Palim, vice president of applied economic and housing research for Fannie Mae's Economic & Strategic Research Group, said in a news release.
