1. Have your credit checked early in the process. Most people do not know their credit scores or what really determines a good credit score. It is not enough to get a free credit report from a single credit reporting agency. It is important that you have a mortgage planner obtain a tri merge report. This will provide scores from all 3 reporting agencies. Typically the lender will take the middle of the three scores when qualifying an applicant. It’s important to determine if there are credit issues early on. Many times they can be corrected in a matter of weeks and will raise your score. A low credit score can cost you many thousands of dollars in mortgage interest.
2. Do not Accumulate new Debt. Many people begin to get very excited at the prospect of buying their dream home. They begin to think about all the items they will need in their new home. New appliances, furniture or even how a new car will look in the driveway. Don?t laugh, I see it all the time. Do NOT accumulate any new debt prior to closing on your new home or it will through off the qualifying ratios and could cause you to lose the home.
3. Know the level of experience of your Mortgage Planner. Many people have a friend or relative that’s “in the business”. Typically this is a licensed but inexperienced person earning some money part time. Your home is the largest investment you will ever have so it is vital to deal with an experienced person. Ask your Mortgage Planner about their credentials. How many families have they served? How long in the business? What is their experience level with the products or programs that you need. Your Mortgage Planner will be handling your hard earned money – be sure that you have confidence in their ability.
4. Assuming that your options are very limited. Too many people think that their options are now limited because of the strain in the mortgage arena. Maybe they spoke to a bank and found that the bank requires 10% – 20% as a down payment to qualify so they decide to continue renting until they have enough saved. There are still many excellent loan programs available some with ZERO down payment. Speak to your Mortgage Planner about the option that best suits you.
5. Be aware of how subtle changes will affect your score. Show caution in having your credit checked. It is important to have it done by your Mortgage Planner for pre-approval but after that be careful. Lenders will view multiple credit checks as a sign that you are trying to obtain credit and will subsequently lower your score. Never close a credit account prior to obtaining your mortgage approval as this will lower scores also.
6. Do not Purposely leave out important credit details. Your Mortgage Planner is on your side. Past credit problems may be embarassing but they will show up somewhere down the road. Be sure to explain everything so you can have a plan of action ot overcome it. Give them the information so they can provide you with the best possible interest rate and service.
7. Be sure to get a Mortgage Pre-Approval. A mortgage pre-approval is a fast and simple process that cannot be overlooked. A seller will want to know that you haev preapproved prior to negotiating a price with you. The preapproval shows the seller that you are not wasting their time and are negotiating in good faith. It will also give you a great sense of security as you are shopping for your dream home.
If you are looking to Buy a Home then visit Crown Financial Solutions’ Detailed FREE report on Attaining your Dream Home with a Zero Down Mortgage or for up to date Mortgage info visit my Mortgage Blog
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