What's Wrong with My Credit Rating?
If you want to obtain a mortgage loan, you'll have to expose your credit record. Many people discover when they get their report that they are in a worse situation than expected. Don’t be afraid if it shows something unexpected. Small problems and errors can be cleared up fairly easily.
How to understand your report? The credit report shows every information when you obtain credit from a bank, a department store, or other lender. Your report indicates the date opened, the lender, your account number, the opening balance, credit limit, and monthly payment. The report also lists the number of times you have been late making a payment at least thirty days, 60 days and 90 days.
Your credit score is a statistical analysis of the likelihood that you will pay back your loan on time. Drawn from variables in your credit report, your rate will range between 400 and 900. You want a score of 620 or higher. If you score 680 or higher, you're considered a premium borrower and you're eligible for lower rates and better terms. On the other hand, if you score 620, you are in a situation of bad credit. doesn't necessarily close the door on a mortgage loan.
What is wrong with your report? Something is wrong in your credit report if certain marks appear. These marks, which lower your score, may cause a lender to decline your loan application. Lenders don't want to see these on your report: bills turned over to collection, late payments (it only shows up on your report if your payment is more than 30 days late), recent or numerous credit inquiries (an inquiry shows up on your report every time you apply for credit), overextended credit, bankruptcy (which may stay on your record for 10 years), liens, paycheck garnishments.
But if you find a questionable bad mark, ask the credit bureau in writing to re-investigate the mark. If you are correct, or if the creditor who gave you the bad mark can no longer verify the information, the credit bureau must remove the mark from your report. If the information that caused the bad credit loan report is correct, check the date. The bureau will clear any mark after seven years.
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