Finding a perfect mortgage when you have decided to purchase your new home is very important to all future homeowners. It is also important to people who might be thinking about refinancing their existing home. Finding a good mortgage to most people means getting a good interest rate and not paying an abundance of fees on their closing costs.
A lender may be advertising for low-interest rates, for qualified applicants. What is a qualified applicant? Do not be afraid to call the lender and ask. Many times, that is someone with a good credit score, but that credit score can vary depending upon the lender’s requirements. Lenders have to be careful too. Just like the consumers do. They probably in the past have made loans to people that have not paid their payments as agreed and have been stuck with a house that they have to sell to recoup their money. This also means they probably have legal fees and processing fees that they need to recoup.
The better your credit score is, normally the better interest rates that you will get on your loan. It is always wise to get anything fixed on your credit report that may be lowering your credit score. If there is something on your credit report that is not yours, or if you have proof that the information is incorrect on your credit report. You can file a dispute with the credit reporting bureau and if they find it not yours, or that it is recorded improperly, they can remove it. This will raise your credit score to a better standing. If you have things that are yours such as a medical bill or another type of bill that needs to be paid off, it will benefit you to pay it off and that would increase your credit score. If you have credit cards, that are close to the limits, paying them down will also increase your credit score.
There are many things that you can do to improve your credit score before you start applying for home loans. While you are waiting for the items you have disputed or corrected on your credit report to start showing up that they are fixed, paid or removed on your credit report and your score to show up at a higher level, that would be a good time to start looking at what lenders are offering. Look at what the prime interest rate is and see who is the closest to the prime rates.
Sometimes there are lenders that offer special programs such as “First Time Home Buyers” where qualified applicants can purchase and move into a home with no money down. This helps many home buyers that have not been able to save a down payment still be able to own and move into their own home.
Buying your own home can be exciting for the entire family. Finding financing may not always be the easiest task. But when you work on your credit reports and get your credit score up to the standards that lenders are looking for, it gives you more power and options as to the types of loans that you qualify for and the number of lenders that will be happy to work with you.
