When you make the decision that you’re ready to buy a new home, you are going to need to take certain steps to make sure everything goes according to plan. One of the biggest mistakes many home buyers make is failing to prepare and plan for their purchase.
This is a significant purchase, probably the most significant purchase of your life, and it deserves the best forethought and planning you can put into it.
The first thing you’ll want to do is make sure your financial situation is ready for the move. You need to make sure that you are in a strong financial position to get your mortgage.
The better the financial position you start from the better the terms of your mortgage will be, the more debt you will be able to pick up if need be, and the lower your interest rates and finance charges. There are a number of steps involved in getting to the point of signing your real estate forms for your home closing.
You’ll need to get copies of your credit reports. Get a copy from each of the credit reporting agencies, as some will have items listed that others do not. If there is anything negative on your report, try to have it removed. If it is a mistake, simply follow the procedure set by the reporting agency to dispute the item and have it removed.
If there is a blemish on your report that is accurate, you are going to have a little more work ahead of you. First, contact the lenders involved in the blemishes and see what you can work out with them.
Some lenders will be willing to make favorable corrections to your credit report in exchange for bringing your account current, or for paying it off if it is behind.
You may be able to secure a new bad credit loan from LocalCashHelp that will start establishing a good record for you. You can also use it to pay off a loan that has delinquent notices and turn it into a good record too.
If you do have to take new loans to clean up some of your credit issues, you’ll need to wait a few months before applying for your new mortgage. You’ll need to make sure the records are cleaned up, and let the activity of new loans age a little to avoid some of the natural caution bankers feel when they see recent activity on a credit report.
Your credit reports will each have a credit score which will be a number somewhere between 300 and 900. This proprietary number system assigns a value to your credit history that indicates a relative measure that indicates your general creditworthiness and risk.
Higher credit score numbers show that you are a better credit risk. The better a credit risk you are the higher the debt load you will be allowed to carry and the better interest rate you will be able to get. It will also even make simply getting the mortgage easier for you.