Tune Your Credit History And Correct It If Needed
Your credit record is one of the most significant
segments of the mortgage loan application process. Your credit score
can and does affect the terms offered by a lender and that can translate
to be money out of your pocket in the form of higher monthly mortgage
payments. The cost of borrowing money is the biggest reason why
you should ensure that your credit record accurately reflects your
Start by getting a copy of your credit information
from Equifax, Experian and Trans Union. Rather than contacting all
three (3) companies, obtain a 3-in-1 merged credit report. There
are numerous companies that will obtain your credit information
from all 3 bureaus for you and merge the information into one report.
There is a fee for this service, but it is well worth the expense.
The contact below will connect you to one such company and we found
there format to be easy to read and understandable.
the 3-in1 Credit Report Online
TrueLink goes beyond the delivery
of credit data with a unique product set that is designed
to help consumers manage their debts as efficiently as they
do their investment portfolios.
Not only should you review your credit report record but you should
also review your credit score. Currently there is only one bureau
providing the consumer with a credit score and that is right from
the source. Read this article on understanding your credit score,
CLICK HERE, and then order your credit score below.
Improve Your Credit Record, Improve
Your Score: Now that you have your 3-in-1 merged report and your
credit score from Equifax, read the information that they have provided
you on how you can petition to correct erroneous information. Correcting
your credit history will often improve your credit score. Generally,
your minimum Fair Isaac or "Beacon" score (provided by
Equifax) needs to be above the following in order to be considered
for a purchase money mortgage: "550"
or above for an FHA or VA loan
or "620" or above for a
(Note: Review the "Local Mortgage Pgms" section of this
web site for an explanation of FHA, VA and Conventional purchase
If your scores are above the minimum its
time to contact a lender. Have a mortgage loan officer review your
credit report (that they call an "endfile") and guide
you on ways to improve your credit score. A loan officer can discuss
with you, the types of mortgage loan programs for which you qualify
in order to better assist you as you develop your plan to buy a
home. Contact a Real Estate Answer Team, discuss your credit and
score with them.
If your scores are near the minimum or
below, you need to learn what you can do to correct the entries
that are adversely affecting your scores and determine how long
will it be before you can obtain a purchase money mortgage.
Ehey affect all of us from time to time.
The key is to minimize the adverse impact life's challenges can
have on your credit record. YOU must be pro-active with your credit
record. Bankruptcies, foreclosures, illness, child birth, disabilities,
divorce, accidents, loss of employment and money mismanagement to
name but a few - can have significant impact on the timely repayment
of your installment debt.
Don't despair - fortunately, a pro-active approach, possibly some
counseling, and time - will overcome all of the above challenges.
Your credit record marks will improve and your credit score will
rise again - So take charge NOW!
Dispute the Credit
Review the information provided in your
credit report on disputing erroneous information contained in your
credit record. Appeal in writing the accuracy of any entry found
in your report in which you disagree. Provide copies of any documentation
supporting your claim for correction to any of the three (3) credit
bureaus that is providing the erroneous information, not just the
company providing you with the 3-in-1 merged report. This process
will take anywhere from two (2) to six (6) weeks or possibly longer
to complete. Here are the three (3) most commonly used credit reporting
- Trans Union
Correction of Erroneous
Entries Contained in a Mortgage Credit Report (3-in-1 Source Report)
On a case by case basis, lenders can often
coordinate with the company that provides them with merged credit
reports and explain the erroneous information (for that report only),
enabling the purchase money mortgage application process to continue.
However, the possibility of correcting the erroneous credit information
locally greatly depends upon the strength of your documentation
and the significance and type of erroneous information reported.
If you are successful in obtaining your financing, the correction
of the merged credit report may only be local. You should continue
the dispute process to the originating credit bureau; provide them
with your dispute and documentation and work with them to correct
their credit record.
If your credit challenges are beyond your
ability to correct the misinformation yourself; then, GET HELP!!!
There are numerous non-profit organizations that provide counseling
and that will get on the right track. CLICK
HERE for a list of organizations providing various counseling
services and consider the Non-Profit Organizations listed below.
If you are having difficulty in managing
your budget, the following organizations will assist you in developing
a game plan to get your debts paid down or paid off and provide
you with the guidance that will help you avoid this predicament
in the future. They will work with you to reduce your monthly debt
payments by contacting your creditors, arranging for a more relaxed
repayment schedule, collect your monthly payment amounts from you
and pay your creditors for you.
(Note: Be aware that this type of service
may require a signed agreement that may prevent you from obtaining
a purchase money mortgage until a significant percentage of the
original loan balances are paid down. It may take you several years
or more depending on the outstanding balances owed before you will
be able to obtain a purchase money mortgage.) Contact the following
organizations for detailed information on their programs and how
they can help you.
- Credit Counselors of Maryland
- National Foundation for Credit Counseling
- Local Agencies
- U.S. Military Personnel Overseas - Online
Your credit report is an important
key to your ability to borrow money. The money you borrow can be
more costly to repay than it should be if you don't monitor your
credit record and credit score regularly. When you do meet one of
life's challenges, be pro-active; ensure that its adverse impact
on your credit record is as minimal as possible.