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This article will enlighten first-time home buyers on the connection between credit and mortgage loans, and why a comprehensive analysis of one's credit must be part of your home purchasing procedure.
The Credit - Mortgage Link
Credit and mortgage loans accord. When you apply for a mortgage loan as a part of the home buying course, the mortgage lender will look at a number of your financial things. One of those criteria is your credit score, which comes from your credit file. Mostly, the mortgage lender desires to know (A) your credit score, which they'll use to analyse the dangers involved in loaning money to you, and (B) your power to control debt.
Inspecting Your Credit
Long before you apply for a mortgage, you check ,inspect at your credit. The idea is to have the "lay of the land" before a mortgage lender places you under the financial microscope. At any rate, this will enable you to circumvent nasty surprises. At most, this will likely allow you to detect errors on your credit file and work to rectify them.
Credit reports are commanded by three credit reporting corporations. Odds are, you've heard of these organizations in the past. They are Experian, Equifax and TransUnion. Your credit score is derived from the reports found in the three credit reports managed by the three aforementioned companies.
Securing Copies of Your Credit Report
As part of an intensive credit-review course, you'll need to start by asking for copies of your credit report through the three companies pointed out above. The best way to do this is to go to http://www.AnnualCreditReport.com. This is a joint website maintained by all three of the credit reporting companies. By law, you are usually entitled one free credit report per year, so you should not should pay anything if this is your first time.
Looking for Credit Errors
When you finally receive your credit report, go over it for mistakes or inaccuracies. Check the personal data to make sure it's accurate. Seek loans or other lines of credit that are not yours (possible credit fraud), and anything else that doesn't seem right. If you discover a slip-up, visit the website of the company at issue to put forward a correction request. Or call this company's customer service number and ask how to carry out.
Don't defer in correcting credit mistakes. The practice calls for time, consequently begin it the moment you discover an error. Under the Fair Credit Reporting Act (FCRA), credit reporting companies take full accountability for correcting incorrect credit reports. So do not hesitate about asking them to take action!
Credit Report vs. Credit Score
Let's clarify the divergence between a credit report and a credit score. When you order your credit report, you won't receive a score. The score can be determined by the mortgage lender, established on information obtained in the credit report. So if you wish to know your credit score, you'll have to acquire it separately.
This article will enlighten first-time home buyers on the connection between credit and mortgage loans, and why a comprehensive analysis of one's credit must be part of your home purchasing procedure.
The Credit - Mortgage Link
Credit and mortgage loans accord. When you apply for a mortgage loan as a part of the home buying course, the mortgage lender will look at a number of your financial things. One of those criteria is your credit score, which comes from your credit file. Mostly, the mortgage lender desires to know (A) your credit score, which they'll use to analyse the dangers involved in loaning money to you, and (B) your power to control debt.
Inspecting Your Credit
Long before you apply for a mortgage, you check ,inspect at your credit. The idea is to have the "lay of the land" before a mortgage lender places you under the financial microscope. At any rate, this will enable you to circumvent nasty surprises. At most, this will likely allow you to detect errors on your credit file and work to rectify them.
Credit reports are commanded by three credit reporting corporations. Odds are, you've heard of these organizations in the past. They are Experian, Equifax and TransUnion. Your credit score is derived from the reports found in the three credit reports managed by the three aforementioned companies.
Securing Copies of Your Credit Report
As part of an intensive credit-review course, you'll need to start by asking for copies of your credit report through the three companies pointed out above. The best way to do this is to go to http://www.AnnualCreditReport.com. This is a joint website maintained by all three of the credit reporting companies. By law, you are usually entitled one free credit report per year, so you should not should pay anything if this is your first time.
Looking for Credit Errors
When you finally receive your credit report, go over it for mistakes or inaccuracies. Check the personal data to make sure it's accurate. Seek loans or other lines of credit that are not yours (possible credit fraud), and anything else that doesn't seem right. If you discover a slip-up, visit the website of the company at issue to put forward a correction request. Or call this company's customer service number and ask how to carry out.
Don't defer in correcting credit mistakes. The practice calls for time, consequently begin it the moment you discover an error. Under the Fair Credit Reporting Act (FCRA), credit reporting companies take full accountability for correcting incorrect credit reports. So do not hesitate about asking them to take action!
Credit Report vs. Credit Score
Let's clarify the divergence between a credit report and a credit score. When you order your credit report, you won't receive a score. The score can be determined by the mortgage lender, established on information obtained in the credit report. So if you wish to know your credit score, you'll have to acquire it separately.
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Another great article by Renfrew Regal Real Estate. Also published at Taking A Look At Your Credit Report When Home Buying.
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