Credit Repair Tips for Buying a House

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A home is one of the most coveted possessions a person can own. Not only does it serve as the foundation for you and your family, but it can be a tremendous financial asset.

It comes as no surprise, however, that a house can be one of the most expensive purchases you will ever make in your lifetime. Unless you have an abundance of cash on hand, you’re probably going to have to take out a mortgage to afford a home. When you apply for a mortgage, your credit is the biggest factor that lenders will take into consideration. If your credit is in bad shape, the chances of getting approved decrease. If your credit is less than stellar, don’t despair! You can clean it up and get it mortgage approval ready.

Here are some tips to help you get your credit in shape to purchase a home:

Check Your Credit Score

First things first: you’re going to want to check your credit score before you apply for a mortgage.

By checking your credit score, you will have a better understanding of where you stand and what actions you need to take so that financial institutions will consider lending to you, and so that you can get the best interest rate possible. You may be surprised to find out that your credit score is pretty good, or you may discover that you need to do some work to bring it up before you apply for a mortgage.

Pay Down Debts

It goes without saying that the best way to improve your credit is to pay down your debts. The less money you owe, the better your credit will be. Start paying down your debts as much as you possibly can. You might need to reassess your budget to do so. Additionally, may want to consider consolidating some of your debts so that it’s easier to manage your monthly payments; consolidating can also help you get a lower interest rate.

Resolve Disputes

A dispute on your credit report is a red flag to lenders. Contact lenders directly to find out how you can handle disputes. A professional who specializes in debt relief can also help you manage any outstanding disputes you may have, improve your credit score and make you look more appealing to mortgage lenders.

Avoid New Debts

Don’t take out any new credit cards and try to avoid accumulating any new debts as much as possible. You want to focus on your existing debts to improve your credit, not add to them. This may mean putting off any big purchases, like a new car or a vacation, but going without now will be worth it in the long run.

Make Timely Payments

Late payments have a detrimental impact on your credit score. Ensure that you are making all of your monthly payments by the due date, or whenever possible before they are due. Consider setting up auto pay with any creditors so that you don’t have to worry about keeping track of due dates and making payments. For any payments that can’t be managed with auto pay, install a calendar or planner on your phone, input due dates for your bills and set it up so that you receive notifications when payments are due.

To learn more about repairing your credit score and getting it mortgage-ready, contact Tayne Law Group, P.C.

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