Freddie Mac CreditSmart Homebuyer U 2025 – 400 Free Practice Questions to Pass the Exam

Lenders primarily evaluate an applicant's credit score when determining mortgage eligibility because it serves as a key indicator of an individual's creditworthiness and financial behavior. The credit score reflects how well a person manages their debts, including credit cards, loans, and any other form of credit. A higher credit score generally demonstrates responsible borrowing practices, which makes the lender more confident in the borrower's ability to repay the mortgage. This assessment helps lenders assess risk, establish interest rates, and determine the likelihood of default.

While other factors do play a role in the overall evaluation process, they are not as foundational as the credit score in determining mortgage eligibility. Personal savings account balances may indicate financial stability but do not directly reflect the applicant's borrowing history. Previous homeownership experience is beneficial but is not a standard measure for assessing risk in lending. Lastly, the length of time at the current residence can suggest stability but does not give a complete picture of creditworthiness as the credit score does.