Five Tips To Keep Your Credit Score High And Your Loan Costs Low
Did you know that your credit score makes all the difference between a mortgage approval and rejection? Before lenders agree to lend to you, they verify your credit score to ensure you can repay the money you borrow from them. If your score matches their satisfaction and they agree to lend to you, your score will be further scrutinized to determine how low your interest rate can be.
However, if you’re score is too low, you might find it challenging to get a mortgage, let alone low rates. But fret not, as there are a few simple strategies which you can follow to boost your credit score. The amount of time it takes to improve your credit score will depend on how badly your score currently is. But, if you start now, you’ll begin to see improvement in approximately thirty days, and in no time, you’ll be able to approach lenders for mortgages at lower rates and better terms.
To help you repair your credit today, Wadhen Mortgage & Financial Services has listed five tips to keep your credit score high and your loan costs low. Keep reading to know what they are.
Tip #1: Know your score
You don’t have to wait until you have been denied credit to get a copy of your credit report and score. You can order one at any time from one of the two big credit-reporting bureaus listed below.
A credit rating is taken into consideration whenever you borrow money, whether it’s to buy a car, take out a mortgage, or apply for a credit card. Bad credit can bring you higher interest rates, the need for a co-signer, or a larger down payment on a home if you get approved for a mortgage. So, monitoring your credit rating is a significant financial responsibility.
Tip #2: Don’t look for more credit
Opening several credit accounts, or even borrowing from them, in a short period, raises alarms at credit bureaus and financial institutions. This is especially true when it’s done by people who don’t have a long-established credit history.
Tip #3: Boost your credit score
A credit score is a collection of lender experiences used when issuing credit to a consumer. Your credit score accompanies your credit report, and your ratings can range from 300 to 850 points - the higher the score, the better your credit quality. Many lenders use credit scores to help them decide whether to lend or not to a specific client.
For this reason, try to fix any issues with your credit report. Yes, mistakes happen, but these inconsistencies can lead to the denial of credit. If you find an error in your report, notify the credit bureau. The lender in question will be contacted, and if the information cannot be verified, it will be removed from your file. Send any paperwork that you may have to the credit bureaus to help your case.
Tip #4: Pay down your debt
For lenders to decide if they want to lend to you, they also need to consider how close you are to the limits on your various credit cards, how much you owe in proportion to the credit you have available, and the number of credit accounts for which you have outstanding balances. To avoid scaring them off, it’s essential to pay down your debts as much as possible, so that you do not exceed 60% of your credit limit.
Tip #5: Stay current
If you don’t pay your bills on time (mortgage payments included), not only will you be charged a late fee, but you may be reported to a credit bureau. Companies have different approaches to deciding when to declare a payment “delinquent.” The grace periods offered may vary, provided that they’re offered. As a result, it’s best to avoid taking any risks by making your payments on time.
For more tips on how to maintain a good credit score and obtain low rates on your mortgage, reach out to Aditya Wadhen at Wadhen Mortgage & Financial Services. As an experienced mortgage agent and financial advisor in Ottawa, ON, I can help you in numerous ways. When you enlist my services, I ensure that I provide you with unbiased guidance in your mortgage decision to get you the right mortgage for your immediate and future needs. My unique working style allows me to stand out from the crowd as I not only work for your current mortgage requirements but also advise you with tips and financial guidance to help you meet your future mortgage needs.