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Knowing Your Credit
Do you know
what's being reported on
your credit
reports? It's important that
you get a
copy of your credit report from
all three
credit bureaus at least once a year. You are guaranteed
one free credit report
from all three bureaus.
Check them for
errors. Mistakes happen and you could be
paying for someone else’s poor financial management. If
you find any discrepancies,
you will need to report it
(in the form of a dispute) to the credit bureau so that
you
can get it
straighten out before you apply
for a loan.
Listed below
are the three credit bureaus
you need to
contact.
Equifax
800.685.1111
TransUnion
877.322.8228
Experian
888.397.3742
Your Credit Score
It's very
important to know your credit
score.
Your credit scores along with your overall income and
debt are a big factor in determining if you'll qualify
for a loan and
what loan
terms you'll be able to qualify for. Your credit
score is a three digit number
ranging from 300-850.
While you can
obtain one
free credit report each year,
you will have
to pay for your credit scores.
You can obtain your
FICO credit scores
from
MyFico.com. |
Credit Do's
1. Pay
down your credit cards. Paying off
or paying down
your installment loans such as mortgage, auto, school,
etc can help improve your score. Getting your
balances below 30% of the credit limit on each card will
also help. The best strategy is to pay down the
credit cards that are closest to their limits.
2. Check your
credit report for any inaccuracies. Mistakes can
happen but you could be paying for someone else's
mistakes.
3. Wait at
least 12 months after having credit difficulties before
applying for a mortgage.
4. Shop
around for mortgage rates all at one time.
According to the credit bureaus, if you shop around for
a loan with the same type of lender (i.e. mortgage
lenders), they will count
as one
inquiry if this is done in a short period
of time.
Credit Dont's
1. Don't open
new credit card accounts before applying for a mortgage.
2. Don't
purchase big ticket items on credit before applying for
a mortgage loan.
3. Don't
charge your credit cards to the maximum limit.
Since it is
your right to obtain a copy of your credit report once a
year, why not order it today? Be informed and know
where you stand!
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