• The cost of borrowing money for a home is increasing, from interest rates to fees for credit checks.
• A homebuyer’s credit score is a key factor, with stronger credit leading to better loan terms and lower costs.
• Despite rising costs, borrowers are showing more discipline by paying down debt and improving credit scores.

Buying a home already means saving for a down payment, shopping for a good mortgage rate and covering closing costs. Borrowing money itself is getting more expensive too, from the interest rate you’re charged to the fees baked into the process.

Take the fee lenders pay just to pull your credit. It’s jumped from a couple of dollars to $30 or more, and they usually pass that cost on to you. It’s one small piece of a much bigger squeeze. Here’s how the cost of credit is impacting homebuyers, and what veteran buyers can do about it.

What are credit costs, and why do they matter to buyers?

In addition to the credit check fee, credit costs cover everything else that comes with taking out a home loan, which may include:

• Your interest rate, the yearly percentage charged on what you still owe
• Origination fees, which are what the lender charges to put your loan together
• Discount points, an optional upfront payment to buy down your rate
• Private mortgage insurance (PMI), a monthly charge if you put down less than 20%

These costs stack up in ways that aren’t always obvious. A rate that’s a fraction of a point higher can cost you thousands more by the time you pay off the loan. And your credit score sits behind all of it. Lenders reward strong credit with better pricing, while weaker credit often pushes costs higher.

Recent credit cost trends explained

Credit card rates offer a good snapshot of what borrowing looks like for the average American right now, and it’s not cheap. Cardholders pay close to 21% on average, and that number climbs past 22% for anyone carrying a balance from month to month. Shop for a new card today, and you’ll likely see offers closer to 24%.

Card issuers set their rates well above the Fed’s benchmark, which has held in the mid-3% range for months. So even with the Fed on pause, there’s been little relief for cardholders.

What’s changed is how people are responding to it:

• Households are leaning less on revolving debt, paying down balances rather than adding to them.
• The typical credit score has crept upward, landing in the 700s on the VantageScore scale.
• Fewer people are falling behind on payments early in their credit card cycle compared to a year ago.

Borrowers seem to be tightening up their habits, but that discipline hasn’t brought costs down. Credit is still expensive to carry, no matter how responsibly you use it.

Why are rising credit costs putting pressure on homebuyers?

Rising credit costs hit buyers twice: once before they’re even approved, and again every month for as long as they hold the loan.

The credit check itself has become a real expense. The total cost of the credit reports needed to close a typical loan has climbed from around $50 to roughly $540, according to an analysis by the Community Home Lenders of America. That’s because a full report pulls from all three credit bureaus. And if your loan takes months to close, you may need to pay for more than one pull.

The rate you’re approved for is what keeps costing you. A higher rate doesn’t only make it harder to qualify by stretching your debt-to-income (DTI) ratio — the share of your income going toward debt. It also means a bigger payment every month for the life of the loan.

Is it true that mortgage credit report costs could increase by 50% in 2026?

Possibly. The Mortgage Bankers Association has reported that credit report costs are climbing 35% to 40% or more in 2026, the fourth straight year of steep increases.

Much of the debate centers on FICO’s pricing. FICO now charges $10 per credit score under its standard pricing option, which the company describes as flat pricing rather than an increase. Equifax, one of the three major credit bureaus, sees it differently, calling it a doubling from the $4.95 FICO charged the year before. Either way, it’s one more fee buyers have to account for.

How does debt affect mortgage qualification?

Debt affects mortgage qualification mainly through your DTI, which measures how much of your monthly income already goes toward paying off what you owe. The lower that number, the more a lender will typically let you borrow.

Here’s what counts toward it:

• Credit card minimums and other revolving debt
• Auto loans, student loans and personal loans
• Any existing mortgage, child support or alimony you pay

Most lenders want your total DTI at 43% or below, though some loan programs will approve higher ratios for borrowers with excellent credit or savings to offset the risk. The lower your ratio, the more borrowing power you have (and the better your odds of landing a competitive rate).

Are veterans facing the same challenges as other buyers?

Yes. Veterans are shopping in the same tough housing market as everyone else, with high prices, thin inventory and steep borrowing costs. But they do have access to loans backed by the U.S. Department of Veterans Affairs (VA), which help offset some of that pressure with lower upfront costs.

How a VA loan can help

The VA guarantees part of your loan, so if something goes wrong, your lender isn’t the only one on the hook. Because the lender takes on less risk, they can afford to offer you better terms than a conventional loan would.

Here’s what that means for you:

• Buy a home with no down payment, so you’re not stuck saving for years before you can apply.
• Skip PMI, which often saves hundreds of dollars a month.
• Get a lower interest rate than you’d likely see on a conventional loan.
• Avoid certain lender fees, since the VA blocks charges like separate underwriting or processing fees and caps the lender’s origination fee at 1% of the loan.

A VA loan isn’t just for buying, either. If you’re unhappy with your initial interest rate, you can refinance your VA loan through an Interest Rate Reduction Refinance Loan, a streamlined option for lowering your rate without a full new application.

What should veterans do before applying for a mortgage?

Before applying for a mortgage, take these steps:

• Request your Certificate of Eligibility (COE) through VA.gov, or ask your lender to pull it for you.
• Locate your DD-214, the document that verifies your discharge status.
• Pull your credit report and fix any errors. The VA doesn’t set a minimum score, but most lenders look for 620 or higher.
• Calculate your DTI to see where you stand before a lender does.
• Ask about a funding fee exemption if you have a service-connected disability.
• Have recent pay stubs, tax returns and W-2s on hand for your lender.

Is now still a good time for veterans to buy a home?

Yes, for eligible veterans. 30-year mortgage rates have climbed back into the high 6% range after dipping earlier this year, and inventory in popular areas remains tight. Even so, not having to put up to 20% down (among the other advantages discussed above) puts veterans in a stronger position than most buyers competing for the same homes.