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Good day!!!
I love what I do. One of the
most rewarding parts of what I do, is when I have a client who is very close
to purchasing but cannot because their credit is just a little bit too low. I
put this email together for one of my clients recently and with a little work
on their part, and around 1 and a 1/2 months, they were able to achieve home
ownership.
These tips don’t only apply
to a first time home buyer. Having been in the mortgage industry for a long
time I have a really good idea as to what needs to be done in order to get
the best credit score.
- Mortgage
lenders like to see that you have 2 active trades on your credit bureau
reporting ideally for a period of 2 years. If one is less than this, we
can still work with that. So, if you only have 1 currently, I recommend
you apply for another one right away. I usually recommend Capital One,
even if you have one already. Even a secured card would be sufficient.
- Try
to get the available credit limits to at least $2,000. I wouldn’t
recommend you keep asking them to do this but to wait for a period, like
6 months and then ask. Asking too much may result in unwanted credit
inquiries which could impact your credit score.
- DO
NOT, ever let your cards go over the Credit Limit, doing so leaves this
information on your credit bureau which will negatively impact your
credit score.
- When
you are ready to apply for a mortgage, make sure the balance to credit
limit is no higher than 30%. Make sure this has been taken care of 1 to
2 months prior to applying as it can take time to reflect this on the
credit report. Prior to this, it doesn’t really matter unless you go
over the credit limit. For example, if you have a $2,000 credit limit,
you want to keep the balance below $600 when applying for the mortgage.
- Do
not allow multiple inquiries into your credit report. Doing so can lead
lenders to believe you might be a “credit seeker” and could impact your
credit score.
- For
any major purchase decisions, you should contact me first. I can offer
you advice as to how this new loan can impact your ability from an
income perspective to qualify for a home.
- You
should contact Equifax and request a free copy of your credit report. Doing
so may uncover any issues, or things that are being reported incorrectly
which you should fix long before you attempt to purchase a home.
- Equifax
Free Report https://www.equifax.com/personal/credit-report-services/free-credit-reports/
- Equifax
Online Dispute https://www.consumer.equifax.ca/personal/dispute-credit-report/
- If
you have any Judgements or Collections, it is important to settle them
prior to applying for a mortgage. Mortgage lenders every single time
require these to be settled prior to obtaining a mortgage. If you are
unsure as to whether or not you should you should contact me for advice.
There are some cases in which I would recommend you leave them.
- If
you are to get into any disputes with a creditor, cell phone company or
cable company, I would recommend you pay these accounts and then dispute
them, so they do not report to the credit bureau. Once these companies
register a judgement or collection, they are extremely difficult to get
rid of.
- Before
speaking to anyone about debt consolidation, or money mentoring of any
kind you should reach out to me as I can offer advice as to what kind of
service the company might be offering, and therefor provide you with
advice as to whether it is a good idea.
- DO
NOT co-sign for any credit. Doing so will potentially cause you 2
issues. The first of which is the potential for missed payments that are
outside of your control. The other, is you must qualify with the extra
debt as if it was your own. It doesn’t matter if you don’t make the
payments.
- DO
NOT Close any of your revolving credit accounts once paid out or prior
to closing. Having access to more credit while not using it will help to
increase your credit score.
If you think this information could help out a friend or a
family member, I would really appreciate it if you would forward this email
or provide them with my contact information. I will look after them as if
they were a friend or family member to myself.
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