One thing that blemishes and bad memories have in common is that they can be erased. It doesn't matter if the spot is on your shirt, your furniture, or your credit report; it can be fixed. Even if you have bad credit, you should still be able to buy a house. Late payments, repossessions, write-offs, and bankruptcy will all leave holes the size of craters in your credit report. They can be cleaned, which is good news. The bad news is that it can't be done in one day. In fact, it would probably take you at least a year to clean up your credit history.
You can't clean your house until you clean up your credit report.
A home mortgage lender is a business person who won't give out money unless he knows he will get it back. This is why lenders check the credit history of people who want to buy a home before giving them a loan. A borrower's credit history is as good a sign as any that they will pay back their debts on time. Because of the same thing, a bad credit history makes mortgage lenders nervous, and for good reason! Consider it. If you are a mortgage lender, wouldn't you be scared to death that you might not get paid back?
How to Find the Marks
Lenders of home mortgages would rather work with people who have good credit, but they don't turn away people who have had problems in the past. In fact, home mortgage lenders are very understanding when it comes to late payments and reporting mistakes. But they are not as understanding about unpaid debts or loans that creditors have written off as bad debts.
So, what do lenders look for in your credit history when they want to give you a mortgage? They are looking for old debts that haven't been paid and bad debts from the last 12 to 24 months.
No maid can clean these spots.
Don't call the maid or a credit repair company if your credit history is full of old debts that are still owed and new debts. Many credit repair companies promise you miracles. They say that they can fix your credit report in one night. Always be sceptical of claims like this. Your credit history can only be cleaned up by you. How do you accomplish this task?
- Make sure you pay your bills on time. Keep doing this, because it will look good on your credit report.
- If you have a lot of loans to pay back, make a plan to pay off as many of them as you can. People who owe too much don't get loans from many home mortgage lenders. As a general rule, your mortgage payments shouldn't be more than 36 to 38 percent of your monthly obligations, which include credit card payments, child support, alimony, student loans, and other bills.
- Don't borrow money until you've paid off all of your debts. You should not only try to get out of debt, but you should also try to stay out of debt.
Most marks don't last forever. You can clean up your credit history just like you would clean a coffee table with a rag.
