Find out how to improve your bad credit score and get a mortgage lender to agree to give you a loan.
Your credit score shows how well or poorly you have paid your bills in the past. If you want to buy a new house with a mortgage loan, the first thing mortgage lenders will look at is your credit score.
Different credit bureaus use different ways to figure out a person's credit rating. But the following basic facts are taken into account:
- A record of payments
- Current debts
- How long your credit history goes back
Credit types are a mix
- How often people apply for new credit
As long as each bureau uses a different set of rules to figure out your credit score, it could be different even if they all look at the same credit report.
Your credit score can be anywhere from 300 to 850. This three-digit number is based on things like how many credit lines you have and how long you've had your account. If you pay your bills on time for a while, your credit score will go up.
If your credit score is less than 300, which is considered to be very low, it will be hard for you to find a good mortgage lender with reasonable interest rates. But if you have a perfect score of 850, mortgage lenders will be happy and approve your applications easily and give you the best interest rates available.
If your credit score is below 620 and you want to improve it, the only thing you can do is plan ahead. You should be careful with your money. Pay the money on time every time. Keep your debts as low as you can, apply for credit as little as possible, and pay your bills on time.
Many people think that their income has something to do with why they have bad credit. It has nothing to do with how much money you make, as some people think. Instead, it has everything to do with how much money you can pay back. Even if you make a lot of money, if you spend it on something else and don't pay your bills, your credit score will be bad. This will make it hard for you to get a mortgage.
So, if you want to find a better mortgage lender who will give you better interest rates, keep the above information in mind and carefully plan your steps to avoid bankruptcy and improve your overall credit rating.
