In the “Did You Know?” department, when applying for a home loan, lenders are generally required to price applications based on the lower FICO score, not the higher. This “minimum FICO” rule is used by lenders and major investors such as Fannie Mae and Freddie Mac.
Research has shown that nearly 10 percent of prime borrowers who applied for loads jointly could have lowered their interest rate by one-eighth of one percentage point if the loan had been applied for by the applicant with the higher score, assuming, of course, that the income was high enough to qualify for the loan.
Experts agree that many couples feel a psychological need to have both names on the note, despite the fact that both could be on the legal title without both being on the loan. Also, the partner with the lower score should see an increase on that score as regular payments are made.
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