Applying for a Mortgage
When there is a goal at hand, it is not always smart to charge at it head on; it is essential plan out a calculated approach. The same thinking applies to credit repair. There is a direct correlation between your credit score, and getting the mortgage rate you deserve. Any discrepancies in your credit report will affect your median score, causing interest rates to sky rocket and loan options to plummet. For any individuals who are facing low credit scores, and in need of a mortgage or a mortgage refinancing, there is hope.
Enacted in 1970, the Fair Credit Reporting Act (FCRA) protects Americans; it is enforced by the Federal Trade Commission and private litigants. Under the Fair Credit Reporting Act, the Consumer Reporting Agencies must verify the accuracy of any information disputed by any consumer. Although, over 80% of credit reports have errors on them! That is where credit repair companies in. By law, the credit reporting agencies have a maximum of 45 days to respond to any dispute. Accordingly, when a letter is received by a credit bureau by a credit repair company, legally they are required to answer it. When you make the law work for you, you win, and that is exactly what credit repair does.
Credit repair companies have their own ways of tackling these creditors, and making them remove negative items on your credit report. Ever since the FCRA made credit repair possible, creditors have been fabricating ways to make it arduous. Credit repair companies are advocates for the consumer, like you, who are tired of being taken advantage of by unfair credit agencies. Typically, this process will take from three to four months, although it may take a little less time or a few months more; it all depends on your specific situation.
When you get to the stage of applying for a home loan, a high credit score will prove extremely handy. Simply put, the higher your credit scores, the lower the interest rate. On a loan as large as a mortgage, a mere point up or down will add up to a substantial sum of money. The fact of the matter is that without a minimum qualifying FICO score of 620, the odds of you hitting the Mega millions jackpot are higher than securing a mortgage. Today these standards are much higher than they used to be, for the industry has diversified in recent years. Accordingly, factors such as your gross income and assets are taken into consideration; the deciding element in the equation is your credit score. The maximum score level on the FICO scale is 850, to achieve the best mortgage interest rates you will want to have a score of 740 or better (from most lenders). So you can see the direct interconnection between your credit score and mortgage rate.
Lenders nowadays are looking for a higher return on more risky investments. To get the optimum mortgage rate, you will need a diverse credit report. For example: auto loans and revolving credit cards (that you are paying on time of course) are the type of positive trade lines that lenders will look at, when making the final decision on your mortgage proposal. To put yourself in a position where can finally get that mortgage for your dream home, there are a lot of variables you must take account of. To ultimately get approved you must insure that a number of determinants are correct.
The ideal time to being checking your credit for a mortgage, is a year before buying a new home. The government allows you to get one yearly credit report for free, organized from the website Annualcreditrport.com, to get your score from the three main credit bureaus. The information on each separate report can vary erratically, so make sure to inspect all three. Certified credit experts can spot disputable differences in a split second, unless trained; these deviations may not be so obvious for you to identify. The trained professionals will know exactly how to handle each specific inquiry, and then effectively initiate the disputes directly to the credit bureaus, so you do not have to.
This amount of money you can save with a decent credit score is tremendous. The best way to raise your credit score is through consistency and persistency. By sticking with a credit repair program, you can achieve your mortgage goals. You will have peace of mind when you can go into a lending office and present the facts, and be proud of your scores. This will create the best circumstance for an attractive loan option; you will be delighted to see that the numbers do not lie. If you are currently in the market for a new home mortgage, then it is absolutely essential to make sure that your credit score is where it needs to be. For more information about how to raise your credit score before applying for a mortgage, get in touch with our credit expert team!