Surefire Ways to Improve Your Credit Score

You have paid down all your credit card balances. You’ve been diligent about paying your bills on time. Now, all your efforts have paid off and you are rewarded with a good credit history and a high credit score.

Having a good credit score will make your life so much easier. A high credit score is a golden ticket in our credit-driven society. The higher you credit score is, the more you can purchase and the more likely you’ll be approved when you apply for a loan.

Here are some the best benefits of having great credit.

People can get loans faster

There is so much more to having a good credit score than a 3-digit number you can brag about. This will make you eligible to get loans easily and without hassle. Lenders and other financial institutions will measure your creditworthiness with the help of your credit score.

A stellar credit history shows lenders that you have the capacity to repay the amount you borrowed and settle your debts on time.

Excellent credit card deals

A strong credit history will help you qualify for the best credit card deals. Because of the amazing deals and perks, people are encouraged to use their credit cards more often. There’s nothing wrong in using your credit card, just as long as you make payments when they’re due. It can even help you boost your credit score.

Approval for higher limits

With a good credit score, banks and lending companies are more likely to lend you a larger amount of money. A stellar credit score is an indication that you are a responsible credit card holder. Your borrowing capacity can increase significantly because of this.

Lower interest rates

If you have a good credit score, expect to get loans with the best interest rates. The difference of even just 1% on a 15 or 30 year home loan can equate to tens of thousands of dollars.

 

Quick Tips to Improve Your Credit Score

Unless you have a lot of money stashed in the bank, you’ll need to secure financing before you start looking at houses. Lenders will check your credit score, income, debt, and savings when making a decision whether or not to approve your home loan.

While it’s still possible to secure a mortgage with low credit score, it will be the basis on what loans you will qualify for and the interest rate you will pay. If you are in the market for a new home, you want to make sure that you have a good credit score.

There are things you can do to improve your credit score. Here are some of them.

Check your credit report

Just because you settle all your bills on time and use your credit card wisely, there is no guarantee that you’ll have a stellar credit score. Sometimes, errors end up on your credit report; thus, affecting your credit scores.

The credit bureau allows you to get a copy once a year for free. To ensure that your credit report is error-free, secure a copy of your credit report and check it thoroughly. In case you find some inaccurate information, report it to the credit bureau immediately.

Don’t close old, paid off accounts

Some people are tempted to close their old accounts after paying off debt, thinking it would negatively affect their credit score. But if you do, then the card issuer will no longer send an update to the credit bureau. Eventually, it will be erased from your history.

The fact that you have paid off old debts can be good for your credit score. If you try to close your old account and expunge the record off of your credit report, your average credit age will be shorter and your credit score will drop. Leave old debt on your report.

Manage your debt

Having too much debt will have an impact on your credit score. To maintain a good credit score, your credit card balance should be within 30% of your credit limit. Even if you subsequently pay your credit card balance when your billing statement comes, issuers will report the balance when you charge more than 30% of your credit limit. Try to keep your credit card balances low. The higher it is, the worse your credit score will be.

Pay bills on time

Certain bill doesn’t get reported to the credit bureau when you don’t pay on time. But that doesn’t mean that you can delay payments. In order to improve your credit score, we highly recommend that you pay all your bills on time. Good debt  is good for your credit.

Simple Ways to Raise Your Credit Score

If you’re planning a major purchase such as a house or a car, then you need to make sure that you have a good credit score. Unless you’re sitting on a pile of cash, that dream purchase of yours may have to be put on hold. Remember, it can be quite difficult to secure a loan with bad credit score.

Improving your credit score is not easy. When you apply for a loan, lenders will take into account your credit history and see your track record in repaying loans. Time is your ally in improving your credit score. As such, it is important that you take steps as early as now.

Here are 3 simple ways to raise your credit score.

Check your credit report

If you are planning to apply for a loan, one of the most important things you should do is to obtain a copy of your credit report. Every consumer is entitled to get a copy of their credit report from all 3 credit reporting agencies every 12 months.

This will give you an idea what lenders will see when they pull out your credit report. Review it and make sure it’s free of errors. Even small errors can severely impact your ability to get approved for a loan, so check it thoroughly.

Pay bills on time

Credit score reflects payment patterns over time. If you are serious about boosting your credit score, then you need to pay your bills on time. It is one of the most important contributors to a good credit. Delinquent payments can have a negative impact on your credit score. Worse, this is going to stay on your credit report for about 7 years.

Eliminate credit card balances

Opening a new card will often have a positive impact on your credit score. However, too much credit will drive your score down. If you’re trying to raise your score, then you need to focus on paying your debt. Unloading debt is the ultimate tried and true credit score booster.

 

Tips to Help You Sail Through Your Mortgage Application

mortgageIf you visit a mortgage lending website, you are likely to see pictures of beautiful homes with smiling families. Then, they’ll lure you in with the promise of helping you find the best loan that works for your situation. But the truth is that getting approved for a mortgage is not as easy as it seems.

Here are a few tips to increase your odds of getting the deal you want.

Do your homework

A lot of people decide to jump into homeownership, even if they don’t have an idea on how to get a mortgage loan. As a result, they end up disappointed because the lender denied their application. When applying for a mortgage, education is key. This will not only maximize your chances of being approved, it will also save you from disappointment and heartache.

Get your paperwork in order

Have your documents ready before applying for a home loan so you have one less thing to worry about. You’ll need to prepare valid IDs, proof of your current address, pay stub banking information that verifies the source of your down payment and a letter that states your income. Having all these documents ready will improve your chances of getting approved and speed up the application process.

Improve your credit rating

One of the most important things you need to do is to make sure your credit rating is as good as possible. Lenders use your credit score to determine you credit-worthiness.  If your credit score isn’t looking that great, be sure to take steps to improve it. Pay your bills on time and try to pay off some debt.

Get a copy of your credit report before applying for a mortgage. This will give you an idea as to what lenders will see when they pull out your credit report. Plus, you’ll want to verify that there are no errors on the report.

Simple Ways to Improve Your Credit Score

credit scoreCredit score – that 3-digit score indicates your credit-worthiness to potential lenders. Lenders use this when deciding whether or not to lend you money. So if you are planning to buy a house in the near future, it is important to take steps to improve your credit score as early as now.

Getting a higher score requires patience. You can’t see the results in an instant. But by following these tips, you can push your credit score in the right direction.

Check your credit report

Each of us has 3 credit reports – 1 from Equifax, 1 from TransUnion and 1 from Experian. You can get a copy of your credit report from each of the 3 major credit bureaus once a year. Once you get a hold of your credit report, carefully review them and make sure that all the information is accurate.

Mistakes happen. In fact, statistics show that as much as 80% of consumers find an error or inaccuracy on their credit report. In case you find one, dispute them with the credit bureau.

Pay your bills on time

Paying your bills on time is the key to boosting your credit score and staying on top of your debt. Late payments, even for just a few days, can negatively affect your scores. Make on time payments each month.

Create calendar reminders for your credit card bills or set up automatic payments on instalment loans to prevent late payments.

Reduce the amount of debt you owe

Paying off debt will not only help improve your credit score, it will also lower the amount of interest you pay. You may not be able to get rid of the late payment mark on your credit report, but paying off delinquent accounts can actually improve your credit score.

Be patient

You need to understand that improving your credit score is like losing weight – it takes time. There is no quick fix for bad credit scores. Consistency and patience is the key to improving your credit score.

 

4 Ways to Buy a House When You Have Bad Credit

Having poor or no credit is a major stumbling block to getting a loan. Oftentimes, this keeps people from even trying to go out and get their own home. Don’t let your credit score keep you enslaved to a life of renting.

While it can be difficult to get a loan with bad credit, it’s not impossible. Here are 4 ways to improve your chances of landing a loan and help you get into your dream home.

Check your credit

The main reason why people do not qualify for a loan is because they don’t prepare. To help you qualify for a mortgage, you may need to get a copy of your credit report. This will give you an idea about what’s stopping your credit score from being in a range that is mortgage worthy. Plus, it gives you a chance to correct wrong information.

The good news is that this can be obtained from any of the 3 major bureaus once a year for free. So you might want to take advantage of it.

Save a larger down payment

There are a number of factors mortgage lenders take into account when deciding whether or not to lend money to a borrower. Your down payment is one of them. In fact, those who have saved a sizable down payment are more attractive to lenders.

Try FHA loans

There are non-conventional programs that allow potential buyers to qualify for a mortgage with less stringent rules. The FHA loan is one of them.

The Federal Housing Association caters to those who have a credit score of as low as 580. Since the FHA is not a lender, they are capable of taking on higher risk clients like those with smaller down payments and low credit scores.

Boost your credit score

If for some reason the tips above do not work, then take time to improve your credit. Buying a house on good credit is always the smartest move.

 

Smart Reasons to Refinance Your Mortgage Now

refinancingnowJust because you’re happy in your home and you have a decent 30-year fixed mortgage doesn’t mean you should become complacent. Homeowners should review their mortgage from time to time in order to see if it still offers the flexibility and features they need or still offers a competitive rate.

There are a number of reasons why homeowners refinance. Here are a few.

Shorten the term of your loan

Many of the terms can change whenever you refinance. This includes the length of time it takes to repay.

Refinancing your mortgage can be a great option if you want to pay off your home sooner. Reducing the term of your loan from 30 years to 15 years will not only reduce the length of time it takes to repay, it also allows you to save on interest. This could equate to tens or even hundreds of thousands over the life of your loan.

Lower payment

If you are having trouble settling your monthly mortgage payment, you might want to consider refinancing. Lowering your monthly mortgage payment will make it easier to pay your mortgage on time every month. With less money will come out of your pocket, you’ll have more money to spend on your necessities.

Lower your interest rate

One of the best reasons to refinance is to lower the interest rate on your existing loan. With interest rates near historic lows, a lot of homeowners can benefit from refinancing. In this case, refinancing your mortgage will help you save money or give you financial flexibility.

Cash out home equity

If you’ve been making payments on your house for years, chances are you have equity in your current home. If you need extra cash to pay off credit card debt, pay for college or finance an important home improvement, you can get cash from your home through a cash-out refinance or a home equity loan.

Change the loan program type

If you currently have an adjustable-rate mortage, and the interest rate at the moment is significantly low, now may be the perfect time to refinance into a fixed-rate loan. By doing so, you can lock in a record-low rate before it starts creeping up again. Plus, you’ll have peace of mind knowing that it won’t take a toll on your wallet in case the rates go up.

Easy Ways to Save for a Home Down Payment

dpg_downpayment_12.8

Most people would love to own a house of their own. Unfortunately, many of them don’t have enough cash for a hefty down payment. This makes me wonder, how many people are deterred to buy a house just because they can’t afford the down payment?

Yes, it’s not something that is easily achieved, but with a little dedication and maybe a different approach to saving, you can turn your home buying dream into reality. It all depends on how motivated you are to accomplish your goals.

Here are 3 easy ways to save for a home down payment.

Eliminate the luxuries

Most people may not like the idea of eliminating or downgrading the luxuries from their lives, but tightening your budget a little can help you save money for your home deposit.

If you eat out a lot, try looking for cheaper restaurants. Or better yet, try eating out less and prepare meals at home. If you buy a lot of new books, try visiting the library. They have thousands and thousands of books that you can borrow, and you don’t even have to spend a dollar for those.

Boost your savings

If you want to save up for a down payment fast, we recommend creating a second income for yourself. You can get a part-time job or work 2 full-time jobs. Use your skills outside of your workplace.

If you are a writer, consider doing freelance writing on the side. If you’re a mechanic, you might want to work on your friend’s or neighbor’s cars over the weekend. You can also sell some stuff on eBay.

Make a vision board

It is easier to keep your eyes on the prize when you have something in front of you. Make a vision board and attach pictures of your dream home. This will make it easier for you put that money aside, knowing where the money is going towards.

 

Reasons to Check Your Credit Report Annually

creditreportcreditscore_iStockphotoFinancial experts recommend reviewing your credit report every year. Despite the fact that we can get a copy every year for free, most people say they don’t do it.

The information on your credit report can affect much of your life – how much money you can borrow, the home you live in and the interest you’ll pay.

If you haven’t seen a copy of your credit report, here are 3 good reasons why you should.

Detect errors

Your credit report may contain some inaccuracies. You can’t correct a mistake you don’t know exists. Since creditors take a look at your credit when applying for a loan or a credit card, they may find some information that can break the deal.

One study revealed that more than 50% of credit reports checked contained errors. These can be the result of human error. Sometimes, information of another person with similar name or account number may be recorded in your credit profile.

Your credit report provides creditors a detailed picture of your credit history. Reviewing your credit report can help avoid costly errors. Be vigilant about your credit.

Stop identity theft

Identity theft has become the fastest growing crime in our nation. If you find accounts that aren’t yours, social security numbers that doesn’t belong to you or find names you don’t recognize, you may be a victim of fraud. If so, be sure to contact your credit reporting agency so that they can place a fraud alert on your account. Check your credit report regularly to make sure that all accounts and inquiries are not fraudulent.

Mortgage application

Potential lenders will want to see your credit report before they consider offering you a loan. Be sure to check your credit report before meeting with a lender.

You can gauge whether or not a lender will grant your request based on the information on your credit report. If you have a less than perfect credit, you might want to take steps to improve it first. We suggest that you limit your credit card purchases, pay off your debt and pay your bills on time. Your credit score will jump back up after a month or two.