Your credit score has a large impact on the interest rate you qualify for. If you are applying for a mortgage and have not reviewed your credit records you are making a big mistake. Here is how your credit score affects your mortgage and what you need to do before applying for a loan. Checking your credit reports for errors is the best thing you can do to ensure you receive a good interest rate on your mortgage. Mortgage lenders use your FICO score to determine what interest rate you qualify for; errors in your credit reports have a negative effect on your credit score and therefore your interest rate. The first thing you need is a copy of each of your credit reports. Dont pay for credit reports; recent legislation passed in the Unite States requires each of the three credit agencies to provide you with a free copy of their records every year. You request copies from each of the credit agencies by visiting the website AnnualCreditReport.com. Once you have these reports, carefully review them for errors. If you find errors you will need to dispute them with the credit agency and the creditor responsible for putting it there. Once your credit reports are error free there are steps you can take to boost your credit score. Start by ensuring there are no late payments in your credit reports. If you found late payments in your credit reports build up at least six months of on time payments before you apply for a mortgage; a large portion of your credit score is derived from your history of on time payments. To learn more about improving your credit score and the mortgage you qualify for, register for a free mortgage guidebook. |
