- The Wisdom Journal - http://www.thewisdomjournal.com/Blog -
Are You Ready For A Mortgage? Part Three: Review Your Credit Report and Credit Score
Posted By Ron On April 27, 2011 @ 1:15 AM In Credit,Mortgages | Comments Disabled
Before you begin shopping for a home (or a mortgage), it’s vital to evaluate your personal financial situation, how much debt you carry, your credit score , how much money you make, how much you spend, and how much you pay out in living and lifestyle expenses each month. To do a complete evaluation:
Previously, we analyzed our finances and determined our maximum mortgage  amount but today, we will focus on the third part of a typical mortgage lender’s evaluation:
Believe it or not, virtually every single financial transaction in your life involving your use of credit over the past 7–15 years is recorded in your credit file. Lenders can find out how well you paid, whether you paid on time, and whether you over-extended yourself. In addition to your income, debt, assets, and expenses (Part One  of this series), lenders also examine your credit report and credit score  to determine whether to approve you for a mortgage  — and if so, at what interest rate.
Though lenders look beyond just your credit score  when deciding whether to approve you for a mortgage , credit scores are a major factor in determining the interest rate that you receive on a mortgage. With a credit score  of 750, you might qualify for a loan at an interest rate of 4.75 percent; if you have a credit score  of 550, you might qualify for a loan at 7.75 percent. Though 3 measly percent might not seem like much, on a $200,000 mortgage  that difference would cost $4,674.36 per year — $140,230 over the term of a 30-year fixed-rate loan. If your credit score is particularly low (below 600), your best move is probably to work on repairing your credit before you apply for a mortgage  loan.
Before you apply for a mortgage, it’s crucial to review a copy of your credit report and to get your credit score, which is usually not included in your credit report. You can obtain a free copy of your credit report at www.annualcreditreport.com .
The main purpose of reviewing your credit report  is to make sure the report is 100 percent accurate. If you find inaccuracies in the report, such as accounts that you didn’t open or past due accounts that you know you’ve paid off in full, you need to correct those problems before applying for a loan. To correct an error on your credit report, contact one of the three credit reporting agencies below—they’re required by law to respond within 30 days to your request.
Getting your credit score for free is easy at GoFreeCredit.com . Simply click the link and you’ll be able to get the information you need to understand how lenders will view your credit reputation. Plus, you’ll be able to spot errors and get them corrected before applying for a mortgage.
Credit scores are relatively easy to review if you remember that you want one over 700 … 750 would be even better. A great credit score helped me refinance MY personal home and save a ton of money in the process. The simple truth is that you need to know your score.
Reviewing your credit report and credit score  is a critical action on your part when you decide it’s time to consider taking out a mortgage. Make sure you know your score before you fall in love with a home.
Article printed from The Wisdom Journal: http://www.thewisdomjournal.com/Blog
URL to article: http://www.thewisdomjournal.com/Blog/review-your-credit-report-and-credit-score/
URLs in this post:
 Tweet: https://twitter.com/share
 credit score: http://www.thewisdomjournal.com/Blog/go/myfico.php
 Analyze your personal financial situation.: http://www.thewisdomjournal.com/Blog/are-you-ready-for-a-mortgage-part-one-analyze-your-finances/
 Determine your maximum mortgage amount.: http://www.thewisdomjournal.com/Blog/what-size-mortgage-can-i-afford/
 Review your credit score.: http://www.thewisdomjournal.com/Blog/review-your-credit-report-and-credit-score/
 Gather and organize the information lenders will require: http://www.thewisdomjournal.com/Blog/are-you-ready-for-a-mortgage-part-four-organize-the-information-your-lender-requires/
 mortgage: http://www.thewisdomjournal.com/Blog/mortgage-basics/
 Knowing your credit score is VITAL to understanding how lenders see you and your reputation. You can find out all three of your credit scores here right now.: http://www.gofreecredit.com/r/4d8948948e/?subid=
 credit score: http://www.thewisdomjournal.com/Blog/credit/#credit-score-information
 Get help repairing your credit here.: http://www.golookonline.com/r/4d89495631/?subid=
 www.annualcreditreport.com: http://www.annualcreditreport.com
 reviewing your credit report: http://www.thewisdomjournal.com/Blog/how-to-review-your-credit-report/
 The Wisdom Journal: http://www.thewisdomjournal.com/Blog/
 subscribe today: http://www.thewisdomjournal.com/Blog/welcome.php/
 Twitter: http://www.twitter.com/wisdomjournal/
 Facebook: http://www.facebook.com/pages/The-Wisdom-Journal/147054648679421
Copyright © 2008 The Wisdom Journal. Some rights reserved.