4 ways to improve your odds of getting a home loan.
There are many ways to create a good credit score and become an attractive prospect for a home loan. The problem is that many lenders are still gun shy from the foreclosure crisis in the last decade. Although interest rates have recovered, lenders still show caution with home loans. Fortunately, there are several ways to show a lender that you’ve got the right stuff.
- Make a Quick Audit. Most prospects that feel good about their credit fill out the application and get their rate quote without delay. If, however, you conduct an audit on your own credit before applying for a mortgage, even finding a single correction or deletion can raise your score 10 points. This is a quick way to raise your score immediately!
- Pay Off Some Credit. Good credit scores are not based on no debt; they’re based on people who use credit wisely. If all of your credit debts are under 30% of the limit of the card, you’ll be in good standing. Pay down a few of those credit balances and you’ll be amazed at how it affects your score.
- Use a Gift. For the best interest rates, a lender requires a full 20% down payment. If you have someone in your family that wants to help out, many lenders will accept a gift as part of the down payment. Usually you’ll simply have to produce a letter that says the money is a gift and not a loan.
- Pay Some Bills. Your mortgage rate will also be based on your debt to income ratio, so pay off some of those debts and your chances will improve! A mortgage professional can be of great assistance when deciding what to pay, because they know exactly which bills affect your mortgage rates the most. Your lender can help you pay off debt most effectively to improve your chances of getting a mortgage with the best rate.
Want help getting your mortgage? Contact Andraya Coulter in Walnut Creek, serving California and Texas, for all of your home loan needs!