Top 7 Credit Repair Tips for Buying or Refinancing a Home - Janesdiary
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Top 7 Credit Repair Tips for Buying or Refinancing a Home

Do you know?

Your credit record and credit score have a significant impact on your life and finances. If you have a high credit score, you will pay thousands less for your home, car, insurance, and other purchases because you are rated credit worthy.

Top 7 Credit Repair Tips for Buying or Refinancing a Home
Do you know?
Your credit record and credit score have a significant impact on your life and finances. If you have a high credit score, you will pay thousands less for your home, car, insurance, and other purchases because you are rated credit worthy.

You may be denied a home loan, remortgage, or even auto insurance if you have low credit. However, most people have no understanding of what it takes to enhance their personal credit score in order to achieve their goals. If you follow these suggestions, your score will undoubtedly improve.

1) Avoid paying for credit repair services.
Everyone has seen the credit repair billboards and advertisements on the side of the road and even the Internet offering to repair your credit for a cost.

Although there may be respectable credit repair consultants out there, I have never encountered one, and I have dealt with many. If you opt to work with a credit repair specialist, you will most likely only hear from them once a month when their service fee is due.

However, there is high-quality assistance available. Locate a Realtor or Mortgage Broker who specializes in credit restoration. The advantage of this arrangement is that your Realtor or Mortgage Broker will not be paid until you acquire the credit score required to purchase a home or refinance your mortgage. You will be charged for results rather than promises.

2) There is no such thing as a magic bullet.

There is no such thing as a magic bullet.
There is no such thing as a magic bullet.

These same credit repair experts will try to sell you their own miracle cure. They will claim to have discovered a credit law gap that allows them to either:

1) successfully challenge your collections and have them wiped, or

2) dispute the way in which the collections were filed in order to have them erased.

 

Creditors are often in a position to lend money because they are well-organized, have long memories, and are knowledgeable about credit legislation.

It is possible to contest credit charges, and genuine collections can be deleted from your credit record. However, there is one major drawback: the collections will resurface on your report after a few months.

Your credit repair professional may dispute your charge, after which the creditor will have 30 days to react. The collection is removed if the creditor does not react within 30 days.

However, as soon as the creditor’s reporting cycle hits your file again, it WILL be reported and resurface on your report. As a result, you may come across someone who claims to have had a positive experience with a credit repair specialist. If you speak with the same consumer again in 2-3 months, they will not have the same compliments.

 

3) Take out a loan

This may appear counterintuitive, yet it is extremely necessary. If you have bad credit, you will need to rebuild it in order for your score to rise. The only way to establish good credit is to work hard.

You need to also note that, to take out a loan Borrowing does not necessarily imply incurring debt. Do you need to make a Best Buy purchase? Make a Best Buy card out of it. Do you regularly purchase gas? Apply for and use a new gas card. Groceries? Make use of a credit card. The trick is to keep spending at the same level while increasing your use of credit.

4) Make On-Time Payments

Now that you’re borrowing money on a regular basis, you must pay it back on time. If you don’t make your payments on time, your credit score will plummet quickly. In this example, timely implies no more than 30 days late. That is fantastic news because your lender will have more confidence borrowing you more loan.

The fact that your credit card issuer charges you a late fee does not imply that they have reported you late to the credit bureaus. Make it a practice to pay ALL of your bills on the same day of the month so you only have to go down the list once and you avoid late penalties and 30 day lates.

 

5) Reduce Your Credit Card Balances

If you already have credit card debt, you should examine how it is dispersed. Ideally, each card should be under 35 percent of its limit, but keeping them under 50 percent will also assist you a lot. You can do this in a variety of ways. Pay the credit cards if you have money in the bank.

There is no savings account in the world that will pay you the interest charged by your creditors. If you don’t have enough money to pay off your debts, ask your creditors to raise your credit limit; most of the time, they will.

Finally, if you have one card with a high balance and another with a low balance, move some of the amount from the high balance card to the low balance card or start a new account and transfer some of the money there.

 

6) Open a new revolving credit line, or two.

If you don’t have any revolving credit (credit cards), it’s time to get two. If you have credit cards in your possession, you will almost certainly need to obtain secured cards. Note that, In order to acquire a credit card, you must first deposit money with the company.

This will appear to be a debit card, but it is not. If you deposit $300 with your bank in order to acquire a $300 line of credit, you have two accounts. When you charge a balance to your line of credit, you must repay it; the funds are not removed from the initial $300 deposit.

After you’ve established your two credit lines, use one for groceries and the other for gas. Gas and groceries are two expenses that practically everyone has, and almost no one will increase their spending simply because they can.

 

7) Purchase a Home If If you don’t currently own a home

You’re undoubtedly working on improving your credit in order to buy one. However, keep in mind that after you’ve made 4-5 mortgage payments on your new home, your credit should surge. This means you shouldn’t be concerned about your interest rate; instead, you should be concerned about getting your home approved.

Avoid paying a pre-payment penalty on your loan and plan on refinancing your higher rate loan for a significantly lower monthly payment approximately a year after you buy.

 

Credit scoring can be perplexing and daunting. Unfortunately, many uninformed professionals pretend to comprehend the scoring models yet do not.

In conclusion

Find someone who specializes in credit repair and has experience, in the success of your repair program Follow these recommendations, give it some time, and watch your results rise!

 

About Post Author

Janesdiary

I am a highly sought-after personal and business branding coach, marriage and Relationship therapist, a blogger and an entrepreneur. I have been blessed with the opportunity to work with some of Africa's most successful entrepreneurs. My success is as a result of my unrelenting passion for excellence in all that I do. My mission is to help people attain their desired goals by teaching them how to be more confident, better communicators and better decision makers. [email protected]
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By Janesdiary

I am a highly sought-after personal and business branding coach, marriage and Relationship therapist, a blogger and an entrepreneur. I have been blessed with the opportunity to work with some of Africa's most successful entrepreneurs. My success is as a result of my unrelenting passion for excellence in all that I do. My mission is to help people attain their desired goals by teaching them how to be more confident, better communicators and better decision makers. [email protected]

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