Before purchasing a new home, you'll likely need to be approved for a mortgage. When a lender considers you for a mortgage, they take into account things like your employment history, income, and your credit report. If you're worried that your credit report may not be up to par, here are a few ways to prepare it for a mortgage application before the Columbus movers arrive on your doorstep.
Check for Things That Might be Hurting You
Before you contact a team of Columbus movers to help you move or start a mortgage application with a lender, acquire a copy of your credit report. This will allow you to see if there's anything that could be hurting your credit. Since there are three major credit reporting agencies, pull a report from all of them. You can usually get a copy of your report from each for free once a year.
Dispute Incorrect Information
Incorrect information on your credit report can harm your credit score and may even put you at risk for getting your mortgage application denied. Once you have obtained a copy of your credit report, check and see if there are any discrepancies. For example, it may state on your credit report that you made a payment late, even though you made it with plenty of time. If you find any mistakes, dispute them with your creditors.
Take Care of Delinquent Accounts
In order to acquire a mortgage, your lender needs to feel confident that you will make your payments on time. If there are any delinquencies existing on your credit report, your lender may lose faith in your ability to pay. Get any delinquent accounts showing up on your report taken care of before you start an application.
Make Timely Payments
Another way to prove to your lender that you'll be able to make your payments on time is to establish a pattern of paying your bills within a timely manner. If you don't plan on applying for a mortgage for a few more months, make it a habit to pay your bills at least the day before they are due. Even making a payment one day late could potentially harm your chances of qualifying for a mortgage.
Reduce Your Debt
The mortgage underwriter working on your application may question your ability to successfully handle a mortgage if you have a high level of debt in proportion to your income. If you can, try to bring your monthly debt payments down to about 12 percent of your total monthly income before applying for a mortgage. If you are unable to do this, you may want to consider waiting to apply before you can get more of your debts paid and out of the way.
Check Your Credit Score
Get an idea of where your credit stands by checking what your score is before you go in to speak with a lender. If you desire to get a good interest rate on your mortgage, your score should be somewhere around 720.
If you're worried about applying for a mortgage, never fear. By following these guidelines, you will be well prepared to make the jump and start a mortgage application with your lender.