Credit is stressful and scary and bad credit can cost you a ton of money! Just think about how many credit repair company commercials you see every day… It is big business for a reason. However, just like studying for a big test, if you don’t prepare correctly, you will risk bas results… but if you prepare in advance and attack it head on by studying, you will be more confident and get better results!! So prepare in advance and work with a mortgage pro who will advise you properly.
So give me the scoop in simple terms.
Credit is super important for the following reasons:
- Determines if you will need to go with an FHA (inferior) or Conventional (superior) mortgage
- Determines your interest rate
- Most importantly but not talked about enough, it determines the cost of your monthly mortgage insurance / PMI
Ok, so how do be proactive?
- Work with a mortgage broker who is knowledgeable with credit. The typical “big banks” will run your credit once and that’s your score. A true mortgage pro will help you get your scores to where they need to be to get you the best loan
- If going to do credit repair, get a referral from your mortgage pro that is mortgage specific. General credit repair companies may get your score up but actually not do it by the guidelines required for the mortgage process
- Don’t be late…. Like ever….
- Keep “utilization rates down” (your balance vs the limit)
- 6 months prior to getting into the home buying process, start to analyze your credit
Contact Danny Costello at Evolution Mortgage who will help you get your score up as much as possible to avoid an FHA loan (if he can) and get you the best mortgage product and interest rate for you!