Ways to Improve Mortgage Acceptance
Buying a home can be one of the largest expenses you may incur in your life. While it may seem intimidating, it can also be rewarding and exciting. One of the first decisions you'll need to make when looking at homes is your budget and then you can start the mortgage acceptance process. There are a few things you can start doing today to make you look more appealing to the lenders, and also make it easier to get approved.
Check Your Credit Report
Your credit report is a detailed report of your credit history, and will be used by lenders to see whether you can qualify for a loan and at what rate. You can get one free credit report a year from Equifax, Experian, and the TransUnion. If you plan your requests for reports properly, you can get one every four months, and keep an eye one any changes.
Fix Mistakes
When you've received your report, it's important to look it over and make sure that everything is correct. Sometimes errors can be made or old information hasn't been removed, and it can take some time to get these removed - which is why you should get your report sooner than later. Here are a few things you'll want to watch for on your credit report:
Improve Your Credit Score
A credit report summarizes your history of paying debts and other bills while a credit score is a number that lenders use to evaluate your credit and determine how likely you are to make timely payments to repay your loan. The FICO score is the most common credit score and is calculated from different credit data in your credit report. These are a few of the aspects of your credit data that will be inspected.
A large down payment can show your lender that you are responsible and know how to save money. A large downpayment can also reduce your loan-to-value ratio, and that will increase your chances of getting the mortgage you want. This loan-to-value ratio is calculated by dividing the mortgage amount by the purchase price of the home. You can lower the loan-to-value ratio by making a larger down payment. If your down payment is 20% or larger, you won't be subject to a mortgage insurance, and that can help you save money.
Hire the Best Colorado Springs Real Estate Agent
The Mike MacGuire team has spent years learning about the housing market, and how to better help you when you are buying a Colorado Springs home. We gather important data about every home, so as to help make the buying process even smoother for you. As a buyer's agent, we will also assist you with For Sale by Owners, builder's, contract explanations, relocation, and anything a buyer may need. Contact us today to buy your new Colorado Springs home!
Mike@BuyWithMike.com
Check Your Credit Report
Your credit report is a detailed report of your credit history, and will be used by lenders to see whether you can qualify for a loan and at what rate. You can get one free credit report a year from Equifax, Experian, and the TransUnion. If you plan your requests for reports properly, you can get one every four months, and keep an eye one any changes.
Fix Mistakes
When you've received your report, it's important to look it over and make sure that everything is correct. Sometimes errors can be made or old information hasn't been removed, and it can take some time to get these removed - which is why you should get your report sooner than later. Here are a few things you'll want to watch for on your credit report:
- Debts that have been paid
- Information that is not yours, due to clerical errors
- Information that is not yours due to identity theft
- Information from a former spouse that shouldn't be left there anymore
- Out-of-date information
- Incorrect notations for closed accounts
A credit report summarizes your history of paying debts and other bills while a credit score is a number that lenders use to evaluate your credit and determine how likely you are to make timely payments to repay your loan. The FICO score is the most common credit score and is calculated from different credit data in your credit report. These are a few of the aspects of your credit data that will be inspected.
- Payment history - 35%
- Amount owed - 30%
- Length of credit history - 15%
- Types of credit in use - 10%
- New Credit - 10%
It is generally known that the higher your credit score, the better the mortgage rate you can receive. It is worth it to do what you can to improve your credit score, and get it as high as possible. You start by fixing any mistakes in your credit report, pay down any current debt, set up payment reminders so you can pay your bills on time, keep your credit card balance low, and reducing the amount of debt you owe in general.
Make a Large Down PaymentA large down payment can show your lender that you are responsible and know how to save money. A large downpayment can also reduce your loan-to-value ratio, and that will increase your chances of getting the mortgage you want. This loan-to-value ratio is calculated by dividing the mortgage amount by the purchase price of the home. You can lower the loan-to-value ratio by making a larger down payment. If your down payment is 20% or larger, you won't be subject to a mortgage insurance, and that can help you save money.
The Mike MacGuire team has spent years learning about the housing market, and how to better help you when you are buying a Colorado Springs home. We gather important data about every home, so as to help make the buying process even smoother for you. As a buyer's agent, we will also assist you with For Sale by Owners, builder's, contract explanations, relocation, and anything a buyer may need. Contact us today to buy your new Colorado Springs home!
Mike MacGuire
Colorado Springs Real Estate Agent
The MacGuire Team
6760 Corporate Dr
Ste 300
Colorado Springs, CO 80919
719-536-4324 or 719-660-6793
Mike@BuyWithMike.com
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