Thursday February 8, 2018
There are different things that you may do to get ready for the home loan process. An especially crucial one is to look through your credit scores ahead of time as it affects your mortgage alternatives and interest rate. Below are home buying credit improvement tips you should consider when buying your new Gehan Home.
Your credit rating affects if you qualify for specific financing programs, so obtain your credit rating prior to starting the home buying process. There are three different credit agencies (Transunion, Experian, and Equifax). Your figure will be different with each of them. If you find any errors, it is vital to start the process of requesting corrections right away as it could take a long time to complete.
If your credit score is below the benchmark used by lenders, find ways of improving it. There are a few methods to do so. If you do not often make charges to credit cards, then they are not reporting information to the credit agencies and are not affecting the score. Make small charges on each card and pay them off promptly. This may help elevate your credit history. If your ongoing balances are high relative to the credit limits, start paying down each card. Note that it is more beneficial to have small balances across multiple cards than to have one approaching the limit.
Major Changes to Accounts
Avoid incurring new debt or closing accounts. Do not make big purchases on your cards. These tend to decrease your credit rating. When lenders see an unusual number of loan applications, they may assume that you are going through financial instability. This is also applicable if you are relying on your credit cards too much and have significant balances.
Additional Home Buying Credit Improvement Tips
By evaluating your credit report, you will have the opportunity to correct inaccuracies. Use the basic practices offered in the above Home Buying Credit Improvement Tips. Note that this is simply basic suggestions. For personalized credit advice, speak to your Gehan Homes sales associate.