You work directly with your creditors to clear up credit issues. When you have a correction, get a letter from the creditor that you can then submit to all three credit bureaus to update your credit score. Important items to note about your credit report include: -Late payments are generally categorized as 30, 60, or 90 days late -The more late payments there are, the lower your credit score and the less favorable your credit looks -If you have previous mortgages on your credit, lenders carefully scrutinize this to see if you were timely on these -Some lenders restrict certain mortgage loan programs to people with no lates within the last 12 months on a mortgage -Other lenders specialize in people who have 30, 60, or more days late on their mortgage, but obviously their rates tend to be higher -Sometimes lenders can be irritated by lots of small $20 or $80 collections from old cell phone bills and similar items this shows that you are not a conscientious customer -If there is an occasional thirty day late on a credit card that has normally been paid like clockwork for several years, this may be explained in writing to the lender as an accident that wont happen again -Sometimes your lender will double check your credit just prior to sending the loan out. If you happen to be late on something, such as a car payment or mortgage, this might stop the loan in its tracks. -When you are in the process of getting a mortgage it is a good idea not to run up additional credit until after you are done Credit Problems -If you have these, it is best to get a copy of your credit report before you try to apply for a mortgage -There may be items that are inaccurately on there, old collections that were paid and should be removed, etc. -Sometimes there will be creditors listed on your credit report that have reported collections for you whose name you dont recognize - this is usually because these are the names of the collection agencies that your bad debt was sold to -You can provide documentation to credit bureaus to have inaccuracies removed from your credit report -Credit bureaus have detailed websites that can tell you exactly what you need to do to try to resolve issues -An important point to understand is that lenders are willing to look at people of many different credit types. There are numerous lenders that focus on people with challenging credit issues. Keep in mind that in exchange for giving risky mortgages to people with credit issues, they are likely to charge higher interest rates. |
