A Low Credit Score Can Affect Your Purchase of a Home
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How a Low Credit Score Affects Your Purchase of a Home
When a lender considers approving your mortgage application, it goes something like this: What is your credit score? What is your credit history? What is your income? How much debt do you have? How much will your down payment be?
When attempting to purchase a home, a large down payment may minimize the negative outcome of a poor credit history. This large down payment, however, will not guarantee a good interest rate or lower fees. In addition, the minimum score required to purchase a home has increased over the past 12-18 months.
There is no way around having a low credit score. Even with a large down payment you will still need a good credit score to make home ownership a reality. Your goal should be a 758 average credit score to qualify for the lowest interest rates, according to CNN.com.
How to Obtain the Minimum Credit Score for a Mortgage
With minimal effort you can obtain your report and see exactly what is there. Often there will be mistakes or errors that you can dispute.
A dispute letter to the relevant credit bureaus would be a good start. Alternatively, to resolve the negative entry, you will need to contact the creditor directly.
A well-written dispute letter will often result in the correction of the credit report, i.e. the removal of the negative entry. It is to be noted though that investigative techniques are often careless and error prone.
While investigating your claim, credit bureaus must spend time and man hours to resolve the dispute. Taking their time or ignoring the dispute is more to the liking of many credit bureaus. They hope you will throw in the towel and give up!
How Long Will I Have to Wait to See an Improvement in My Credit Score?
Often people want to know how long it will take to see an improvement in their credit score. This answer, of course, is dependent upon the individual situation, however, in many cases, an improvement may be seen by 6-12 months.
This is a long time but it certainly beats 7-10 years for the negative information to be dropped. It is beneficial to wait 6-12 months to raise a low score, especially when purchasing a home.
We raised our credit scores from the upper 500 range to 745 and 763 in under six months and got approved for our dream home. Discover the one rule you must obey in credit repair by seeing proof at www.creditforcouples.com and get the real truth about lexington credit repair.
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