Getting approved for a mortgage loan is no walk in the park. Credit appraisal and verification of your documentation is a foundational part of the procedure. A healthy credit score may be the single most important factor and be the pivotal detail determining whether you qualify for a mortgage loan or not. Many of us have unhealthy financial habits, don’t always make payments on time and engage in erratic spending patterns, it is things like these that will adversely impact a credit report. It’s extremely important to take matters in hand, to stabilize and improve your credit score – before you even start thinking of realizing your dream to buy a house.
Following are some useful tips on how to improve your credit score –
Check your credit report regularly and address any irregularities or ambiguous information. Clear up errors and file any disputes. Carefully review your report and get specific advice on the steps you should take to improve your score.
Schedule your payments to occur automatically, making sure they happen at least 3 days before they are due, avoid defaulting at all costs. Making sure your repayment records are straight will maximize your credit score. Reduce your loan to debt liability as much as possible by paying more than the minimum required on loans and credit cards. This action alone will improve your net worth.
Avoiding applications for new loans will keep your credit usage low and improve your credit score. Taking on too much credit – liability might imply that you do not have enough liquidity – available cash; this is usually a negative on your credit usage. Further more avoid, at all costs and definitely immediately prior to your mortgage loan application, any credit applications, these include: credit cards, store credit cards, car loans, education loans, elective dental or non urgent surgeries with significant co pays, personal or business loans. Any of these will adversely effect your loan application. It is crucial to keep a considerable period of time between your last credit application and the loan application date.
Make a concerted effort to save money – physically making regular deposits into a savings account. It is very important that you make regular deposits, (an automatic deposit within a day of you getting paid is ideal.) no matter how much, regular deposits is better than one big deposit every 2 months or so. This not only boosts your savings account, it shows responsibility, restraint, consistency, and commitment. As funds accumulate over a period of time reliance on credit declines, you have funds available for emergencies and the all important down payment
Seeking advice from an expert, on exactly what you should do and how – can, when the time comes, help expedite your loan application. Drew Mortgage Associates are one of the top mortgage companies in Massachusetts, they can help you improve your credit score, give advise on the best mortgage loan for you and help first time home buyers in MA understand the online mortgage loan application procedure.