Buying a Home with a Low Credit Score
A lender considers the following questions when deciding to approve your mortgage application: Is your credit history good? What is your yearly salary? What is your total amount of debt? What is your down payment?
A gigantically large down payment may dilute the negative effects a spotty payment history or low credit score to some extent. However, be prepared for high fees and interest throughout the life of your mortgage.
In short there is no way around having a low credit score. Even with a large down payment you will still need a good credit score to make home ownership a reality.
Specifically, you should aim to have a 758 average credit score to qualify for the lowest interest rates, according to CNN.com.
Within the last 12-18 months, the minimum score to qualify for low mortgage rates has increased. Qualifying for the best mortgage rates has always meant that you need to have a good credit score.
How to Obtain the Minimum Credit Score for a Mortgage
Don't be confused by your credit score. Simply remove bad credit information to see an improvement.
Don't believe the "experts" when they tell you that you cannot remove bad information from your credit report. They want you to think that you have to wait 7 - 10 years for the negative information to fall off your report and raise your credit score.
You can take matters into your own hands by obtaining your credit report to see what's on it. Quite frequently, there are mistakes or errors that you can challenge now, and not wait 7-10 years for it to disappear.
Write a dispute letter addressed to the credit bureau or bureaus to dispute the errors. This will save you the frustration of working with the original creditor to fix the error.
More often than not, a well-worded credit dispute letter will resolve the error. In some instances, errors and sloppy work, hinder the investigation process.
Unfortunately, some credit bureaus do not want to spend the time or resources needed to investigate a dispute. Your dispute may be delayed or ignored if it is too labor intensive and therefore, not cost effective.
Credit bureaus bank on the fact that you will probably give up and live with the cost of bad credit. Many people hire credit repair services to represent them in the dispute process.
When Will My Low Credit Score Be Raised
The most voiced concern is the amount of time it will take to improve a low credit score. While everyone has a unique situation, you can expect a fairly drastic improvement in your credit score within 6 to 12 months.
This is nothing compared to waiting seven to ten years for the negative information to disappear from your credit report. It will be well worth the 6 to 12 month wait needed to raise your credit score, so you can purchase a home.
A gigantically large down payment may dilute the negative effects a spotty payment history or low credit score to some extent. However, be prepared for high fees and interest throughout the life of your mortgage.
In short there is no way around having a low credit score. Even with a large down payment you will still need a good credit score to make home ownership a reality.
Specifically, you should aim to have a 758 average credit score to qualify for the lowest interest rates, according to CNN.com.
Within the last 12-18 months, the minimum score to qualify for low mortgage rates has increased. Qualifying for the best mortgage rates has always meant that you need to have a good credit score.
How to Obtain the Minimum Credit Score for a Mortgage
Don't be confused by your credit score. Simply remove bad credit information to see an improvement.
Don't believe the "experts" when they tell you that you cannot remove bad information from your credit report. They want you to think that you have to wait 7 - 10 years for the negative information to fall off your report and raise your credit score.
You can take matters into your own hands by obtaining your credit report to see what's on it. Quite frequently, there are mistakes or errors that you can challenge now, and not wait 7-10 years for it to disappear.
Write a dispute letter addressed to the credit bureau or bureaus to dispute the errors. This will save you the frustration of working with the original creditor to fix the error.
More often than not, a well-worded credit dispute letter will resolve the error. In some instances, errors and sloppy work, hinder the investigation process.
Unfortunately, some credit bureaus do not want to spend the time or resources needed to investigate a dispute. Your dispute may be delayed or ignored if it is too labor intensive and therefore, not cost effective.
Credit bureaus bank on the fact that you will probably give up and live with the cost of bad credit. Many people hire credit repair services to represent them in the dispute process.
When Will My Low Credit Score Be Raised
The most voiced concern is the amount of time it will take to improve a low credit score. While everyone has a unique situation, you can expect a fairly drastic improvement in your credit score within 6 to 12 months.
This is nothing compared to waiting seven to ten years for the negative information to disappear from your credit report. It will be well worth the 6 to 12 month wait needed to raise your credit score, so you can purchase a home.
About the Author:
Discover how lexington law helped a local couple get approved for a mortgage despite having bad credit. Visit their website www.creditforcouples.com to find out how they deleted charge offs and collection items. You can also grab a free credit repair letter or dial 1-866-246-7311 for a free consultation.
You like it? Share it!
posted by SolveItQuick at
11:34 AM
0 Comments:
Post a Comment
<< Home