Mortgage Everett: How to repair your credit for better rates
The FHA mortgage doesn’t go by credit scores, or does it? While HUD does not link an FHA mortgage to your credit scores most lenders will. The reason lenders don’t follow the FHA mortgage rules refer back to the “investor” who will buy the loan. Some simple but effective methods to improve your credit score are as follows. First contact any accounts that you dispute late payments with. Sometimes you can get a late notice removed simply by asking. Next pay down your credit cards and other revolving debt to about 1/3 of the credit limit. You need to have credit and you need to use it. You should have a small balance. The scoring algorithms of the bureaus suggest that a 1/3 balance or less, of your credit limit, maximizes your score. Now you don’t have to pay all of them down but select a strategic few and target those for pay-down. This usually takes less than 30 days. If more repair is needed then do as follows. Challenge letter need to be made for all negative credit entries on your credit report. Send these letters to each bureau with details on why you think the entry was incorrect. The bureau must ask each credit vendor if your challenge is correct. The vendor must respond within 30 days of your inquiry. Repeated challenges can wear out credit vendors. Some will miss the 30 day deadline and others will simply not spend the time to respond. This method will take longer but will result in higher credit scores and a cleaner credit report. Right now applicants for FHA mortgages, make that all mortgages, need to be aware that your credit should be kept as clean as possible.
Every mortgage loan is very important to me, so I handle each one personally. My background includes extensive knowledge of the real estate market, real estate finance and personal taxation. If you are looking to refinance or purchase real estate please give me a call or email. I will be happy to discuss all options with you. Currently I have access to 70+ lenders. I have access to 4 different credit repair agencies. My goal is to become your lifetime lender. thefhaloanguy@aol.com
