The first thing that matters when looking to purchase your dream home is your credit score. The three digits carry a great deal of weight during the mortgage process. Start from your chances of getting approved for a loan to the interest rate you have to pay. These small factors have a great impact on the years to come, and determine the way you lead your life.
While your credit score does not have to be perfect - However, you must work on your credit score as much as possible to ensure you get a better deal. To help you out we have listed down 3 ways you can fix your credit score, and finally get the home of your dreams.
Identify & Settle Issues
Reports prove that 1 in 5 Americans have major errors on their credit reports, which is why it's crucial to start by going through your credit report. Once you have gone through the entire history at least twice, mark out the issue(s) if any. The issues can be rectified by sending in a letter of dispute to the credit bureau requesting them to remove the error. Attach supporting documents proving the error, so the issue can be rectified as soon as possible.
The credit bureau is required by law to investigate and rectify the error within 30 days. Meaning the error will be automatically removed if the creditor is unable to verify its accuracy. Once the changes have been made you will receive a result of the investigation, along with a new copy of your credit report. This way you can see the amendments made to your credit data, and how it impacted your credit score.
Settle Outstanding Debts
Outstanding debts that have found their way into collections can easily bring your credit score down. Start by settling your outstanding debts, so the negative impact is removed from your credit report. This might take a while to pay off, but consider it a necessary step when looking to build your credit score.
Tip: Write down all the information from your call. Start with the name of the individual you spoke to, their contact information, any negotiations, or anything related. Make sure you ask for a “pay for delete” letter from the agency, so you can easily confirm that you have paid the amount and the debit will be removed from your report.
Pay Your Balances
Credit utilization makes up 30% of your credit score, so when you start to pay off the balance on your credit card you will see your credit score rising. Its best to pay off as much utilization as possible, while there is no set number. It's best to keep your utilization below 30%, which can easily be done by using less than 30% of your available credit. Once you do, you will see a dramatic change in your credit score.
Using up less than 30% of your available credit is not easy, but it is not impossible. When looking to make a change in your credit score - you have to make a few lifestyle changes that allow you to set your priorities straight. The more you shave off the better it will be in the long run. Furthermore, once you get settled with the lifestyle you will never have to take on more loans.
Holliday Credit Repair can help you fix your credit score, and even get the home of your dreams! Working around the clock they ensure every single individual has the information and help they need to start building their future.