If you have damaged credit, you need to know that you are not alone. In fact, a lot of people are struggling with damaged credit due to varied reasons. Far instance, you may be finding it hard dealing with your current situations due to the recession, and you may have lost your job unexpectedly. Or maybe you are in the middle of your divorce processes.
A bad credit is sometimes caused by poor financial management systems, foiled business, misuse of funds or even poor spending habits. In such cases, you may apply for a mortgage loan that will enable you to get through this murky financial crisis.
However, for you to get accepted for any mortgage, you need to show interest in repairing your credit, or at least, try it.
It is vital that you clean up your credit card. To do this, you may have to request the three major credit bureaus to furnish you with your credit reports. You need to examine it carefully.
You need to scrutinize your report for unauthorized charges, inaccuracies, or any other errors. All credit holders have the right to dispute errors in their credit files. Essentially, this is the easiest and the smartest way to boost your credit score.
You also need to be keen to look for any negative remark on your credit report. If you find one that is older than seven years, do not hesitate to ask the credit bureaus to expunge it off your credit report. For example, you may have filed for bankruptcy before, like 7 years ago – the record need not to be included in your recent credit report.
The next thing that you need to do is to work towards improving your credit score. You need to make sure you got not standing debts in any of your accounts. You have to submit your payment on time and regularly to demonstrate that you care about your credit rating.
If you have damaged credit; you cannot afford to make another late payment. It is also best if you can minimize your credit usage at all costs. It is best if you can manage to use less than 20% of your credit limit.
You may also need to check out if the government gives loans. These loans are great for those with bad credits. You need to find out if you qualify for the same. What is more is that these government loans are less stringent as compared to the commercial lenders and banks. Their interest rates are incredibly low.
When applying for your mortgage, you shouldn’t give submit several applications to various lenders. Submitting several applications may give a negative impression to a lender that was about to yield. It can also cause a dramatic drop on your credit score.
If you are careful to follow these tips, you are going to get accepted by your lender when applying for your mortgage.