Setting up the housing market for a strong spring, mortgage rates have fallen to their lowest since February 2018. Seeing as it may be a time to buy a house pretty soon here, today we’re providing an article on home buying tips for those individuals with low credit scores!
First and foremost, lenders check your credit score to gauge whether or not you are a risk for another loan. If you’re credit score is high, you should be in the clear, however we’re aware that’s not the case for everyone. So what exactly can you do to boost your score? In order to answer that it’s important to first know what impacts your credit score. Credit payment history, debt-to-credit utilization, length of credit history and new credit accounts.
Initially you should review your credit history for any errors, and if any are found then you should challenge them as soon as possible. For example, say you’ve never missed a payment on your credit card. It is highly possible that there is someone who has the same name as you who may have missed a payment, and this false information could be impacting your score. According to a Federal Trade Commission survey, one in four Americans has an error on their credit report, so always review your report for errors.
It may seem wise to pay off all of your cards or open a new account in order to increase your score, but these can actually have adverse effects that you may not be aware of. This is why it’s so important to involve a mortgage consultant throughout the whole process as they can inform you of the best route to take.
All in all, even individuals with low credit scores have numerous buying options when it comes to mortgages. Reach out to a mortgage consultant today to find a program that works for you!