5
Impor tant Ways to Increase Your Credit Score
Owning a home is a dream for many but is completely unattainable for some.
There are times when the desired home is financially out of reach, and others when the buyer's credit is not deemed worthy for lending.
For the latter group we have 5 great tips that will help you raise your credit score so you can qualify for a fantastic home loan rate.
To help us with the following list of tips, we interviewed Christopher Pascale, a former U.S. Marine currently working as an accountant and consultant.
He and his wife have bought 3 homes since 2007 using a VA loan each time.
TIP 1:
OBTAIN CREDIT
It may sound simple, but this is a process of baby steps. You cannot increase credit if you have none.
If you're in college, you can apply for a student loan. If you do not need the funds for tuition, you can hold on to it and then use that same cash to repay the loan in full.
Another easy way to get credit (especially if you're a student) is to get a student credit card. Use it at least once every 6 months, then pay it off.
TIP 2:
PAY EVERY THING ON TIME
When you have access to credit, you must treat it as a privilege.
The lender sees you the same way you would see someone who promised to pay on a certain date but doesn’t.
When you make timely payments, of the minimum balance or more, your score increases.Â
TIP 3:
GIVE YOUR CREDIT TIME TO HEAL
The trick is to get back on track by making timely payments as you originally intended.
After a year your credit will be better. And after 3 years, you should be in the range to get a very good home loan rate.
TIP4 GROW YOUR : LIQUID ASSETS
Buying a home requires cash. You will need money to pay the closing costs, particularly if you want the most competitive rate.
You also need it to increase your credit score. Having cash makes you more desirable to lend to.
Why? Because if you have money, you can pay back what you borrow.
TIP 5:
RESOLVE OLD BAD DEBTS
Lastly, for those who have defaulted on old debts, they will stay on your credit report for at least 7 years. But you can get rid of them.
First, you need to call the creditor (be it a hospital, credit card company, or old landlord) and negotiate to settle the debt in full.
For example, if the debt is 4-years-old and the amount is $1,000, it would not be unheard of for the creditor to accept $300.
Second, and very important, is for you to get a letter stating that $300 "settles this in full" otherwise they may come after you in the future to collect the rest.
Clearing the old debt will help increase your credit score because it eliminates a formerly defaulted account.
By following these 5 steps you can increase your credit score, which will get you a better home loan rate, meaning that you'll save thousands in interest payments down the road.
Mortgage Originator Jimmy Vercellino, specializing in VA loans, helps veterans use their VA loan benefit to their greatest advantage.
Be a proud homeowner today. For more details call 480-351-5904 or visit the site www.valoansforvets.com
VA Loans for Vets 7702 E. Doubletree Ranch Road, Suite 220 Scottsdale, AZ 85258 Phone: (480) 351-5904 Email: jimmyv@fcbmtg.com
Jimmy Vercellino, NMLS 184169 Mortgage Originator Specializing in VA Loans
The views expressed here are those of the individual author and do not necessarily represent those of First Choice Bank (NMLS #: 177877) and First Choice Loan Services Inc. (NMLS #: 210764). Equal Housing Lender.7702 E. Doubletree Ranch Road, Scottsdale AZ 85258 The views expressed on this site are those of the individual author and do not necessarily represent those of First Choice Bank (NMLS #: 177877) and First Choice Loan Services Inc. (NMLS #: 210764). Equal Housing Lender.