If you have bad credit; it is worth knowing that you are not alone. In fact, a lot of people are struggling with damaged credit due to varied reasons. For example, you may have been affected by the recession, and you lost your job when you didn’t anticipate. Or you might be getting your divorce processes dealt with properly.
A bad credit is sometimes caused by poor financial management systems, foiled business, misuse of funds or even poor spending habits. If you are faced with any of these circumstances, you may have to consider applying for a mortgage loan that will help you pull through these economic uncertainties.
However, for you to get accepted for any mortgage, you need to show interest in repairing your credit, or at least, try it.
It is important that you clean up your credit report. To do this, you need to request your credit report from each of the three major credit bureaus. Carefully scrutinize your report.
Ensure that your report does not have any errors, inaccurate information or unauthorized charges. You have every right to dispute any error that you find on your credit files. Such drastic measures are considered the best way to boost your credit score.
Be keen to look for any negative remarks on your credit report. If you discover a 7-year-old negative comment, do not take that sitting, rather, ask the credit bureau to expunge it from your files as soon as possible. Maybe you had filed for bankruptcy ideally, the record should not be shown on your recent credit report.
The next thing that you need to do is to work towards improving your credit score. You need to ensure that you have no past due debts in any of your accounts. You need to be punctual in submitting your payment to show your creditors that you are seriously concerned about your credit rating.
If you have bad credit, you can’t afford to make another late payment. It is also best if you can minimize your credit usage at all costs. You need to struggle to use less than 20 % of your credit limit.
You may also need to check out if the government gives loans. These loans are the best deals for those with bad credit. You may need to find out if you qualify for the same. What is more, compared to the commercial lenders and banks, the government loans are less stringent on clients with bad credit. They also charges fewer interests.
When applying for your mortgage, you shouldn’t give submit several applications to various lenders. Too many inquiries can send a negative impression to your potential lender. It can also cause a dramatic drop on your credit score.
If you are careful to follow these tips, you are going to get accepted by your lender when applying for your mortgage.