If you are getting ready to buy your first home (or even if you are not a first-time home buyer), you will likely know that having a good credit score will increase your chances of getting approved for a mortgage. Also, having a good credit score will give you a shot at reasonable interest rates. The good news is that there are specific steps a would-be home buyer can take to help spruce up their credit score to get it ready for a mortgage application.
To ensure that your credit score and history will be presented in the best possible light to a potential lender, here are some of the most effective steps you can take to get your credit score ready before a lender peruses your application.
Steps to Get Your Credit Ready Before Applying for a Mortgage
An applicant’s credit score is one of the most important considerations a lender will consider when reviewing an application. This is why it is crucial to do everything you can to ensure that your credit score will be at its highest when you apply. There will be many different types of home loans available, and they will all have their criteria and credit score requirements to meet. Even if this is so, it is best to make your credit score the highest it can possibly be to give you the best chances of getting approved.
1 – Check Your Credit Reports
Before anything else, it is vital to check where your credit currently stands. The lowest credit score needed for even the most lenient home loan is at least 580. If you have a lower score than that, you need to know how much catching up your score needs to be able to make the cut.
2 – Avoid Applying for New Credit
At this point, if you want to better your credit score, the best way to go about it is to avoid applying for new credit cards and making large purchases before applying for your mortgage. While it is true that using your credit card and paying off the debt promptly will help establish your credit, applying for more than one credit card right before a mortgage application may hurt your credit score.
3 – Reduce Your Credit Card Debts
Suppose you have any un[aid credit card debt, it is best that you work to repay them and lower them as much as you can before you think to apply for a mortgage. It will establish that you are a good payer and show the lender that you will not fall behind on your payment later on.
4 – Find the Right Lender and Loan
Lastly, it pays to shop around and look for the right lender to offer you the right loan term to fit your needs and budget. This will help you get ready and know what to expect when they review your application.
Getting your credit report and score in the best shape as you can make it is a must before applying for any mortgage loan. After reviewing your credit, doing the steps it takes to better your score, and shopping around for the best deals you can find, you will be ready to present your application to a lender!
Once you will have your credit in order and be ready to apply, come to Cal Coast Funding! We are a premiere mortgage lender located in sunny San Diego, CA. We pride ourselves on offering competitive rates and outstanding service. The Cal Coast Funding team has over 20 years of lending experience, and we look forward to serving you! Get the best mortgage solutions by getting in touch with us today!