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Imperfect Credit

So your credit isn’t perfect.

Guess what, you’re not alone. The trick is to face your situation and learn how to improve your credit rating. Here is some information that may point you in the right direction.

Mortgage Lenders are very concerned about credit scoring. These days a computer model called, FICO rates your credit scoring from a low of about 350 to a high of around 850. Anything above 680 is considered very good credit. The worst thing that you could have on your credit is a foreclosure. Most lenders want to see a 4-year clean history after a foreclosure. Other major disasters include a Bankruptcy, late mortgage payments within the last twelve months, and tax liens.

Consolidating multiple charge accounts down to one loan can help improve your score. The important thing to remember about a new mortgage if you’ve had credit problems is that the new loan is a step in the right direction, not the final solution. Sometimes borrowers will have to take one, two or maybe three steps to help improve their situation. Just because you’ve had bad credit doesn’t mean you should expect to pay through the roof. Loan costs can be built into a refinance loan, and sometimes increasing the interest rate a small amount can eliminate a lot of fees.

If you have collection accounts on your record you can sometimes pay them off and get them removed from your credit reporting. Once removed, your credit scoring will improve a lot. At Residential Home Funding Corp., we have lots of ideas that can help you not only obtain the best loan for you today, but also help you plan ahead. Why not give us a call and we can help point you in the right direction.