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home loan credit report mortgage answer.
The answer is probably in your credit report. When lenders decide whether to grant
credit and at what rates, they base the decision on information in these reports.You
always pay your bill on time, so you think your credit is spotless.
But one day you"re turned down for a credit card. Next you don"t get the low
rate you thought you deserved on your car loan. Suddenly you start to wonder why lenders
consider you risky business.
" A credit report does not say "pass" or "fail" but it does
represent your credit references".
Lenders look at several factors when you apply for a loan, including how much debt you
carry and whether you"re been late on your payments. The information in your
credit report also contributes to your credit score, a number that's intended to sum up
your credit worthiness. Many creditors look at that number as well. Understanding how
credit reports work and what to look for might help you come up with a better score when
it comes time to apply for that all important mortgage or auto loan. " If there is a
problem on the report , you can usually solve it", but to make sure leave yourself
time to deal with with the report.
Is this mine ?
Look at all the accounts listed. Are they yours? "You want to make sure no
one is using your credit to commit fraud" If any of the accounts are not familiar,
even if it has a zero balance, you need to investigate. It might signal the beginning of
identify theft.
Here are some other problem areas to check: If you have a common name, such as Mike Smith,
or if you are listed as junior, such as Bob Jones Jr., be aware that you might be more
prone to having your accounts mixed up with another customers. You will want to get those
matters cleared up as soon as possible.
If you have co-signed for a loan, that becomes part of your credit history. If the person
you co-signed for is late on the payments, that will show up on your credit report as
well.
To those who are recently divorced: A divorce decree does not release you from your
responsibility on any accounts. They need to go back to the creditor and separate the
accounts. People think the divorce decree changes things, but it has nothing to do with
your original credit agreement.
Close those old accounts.
One sure -fire way to boost your credit score is to close unused
accounts. Maybe there are some old store cards you have not used in
ages because you do not shop at those places any longer. In ever
circumstance, get rid of them. It will immediately raise your score. What is
the big deal? Those open lines of credit could count against you because
they signal potential debt. you might have 10 credit cards but use only two.
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home loan
Watch out for those inquiries.
Inquiries, inquires, inquires. Too many of the m can hurt when it comes time to get a
loan. Two types of inquires show up on your credit report, and most of them don't count
against you. First, there are inquires you initiate when you apply for a loan or a
credit card. These are called "hard" inquires, and there are the ones you want
to keep to a minimum. They stay on your report for two years. Lenders see those
"hard" inquires when you ask to borrow money. They particularly look at the
newer inquires, because those might not have shown up on your report as yet. How many
"hard" inquires does it take to hurt you? That depends if you have 10 in six
months and they are all credit card inquires, that would be a red flag to a lender.
Do not authorize anyone to run your credit unless you plan to rent or buy from an
individual. If you are shopping for a car, for example, do not let every dealer check your
credit or you will wind up with inquires from the credit checks they have done. (Plus the
financing firms connected to the dealers will run credit checks as well). Also do not sign
up for credit you do not need, such as a store card that offers a one time freebie just
for opening an account. There is another kind of inquiry listed there that does not count
against you. Those inquires made by financial institutions that are considering whether to
solicit your business. They might want to send you a "preapproved" credit
card offer, for example. These "soft" inquires are not initiated by you, and
lenders do not see them on the report they are given. People sometimes think that these
inquires are ruining their credit. Not true.
Beware of maxing out your credit.
When you examine your credit report, you will see your accounts and credit
limits, and you will notice haw close you are to maxing out those credit lines, a red flag
in the world of lending.
It is a bad sign to max out that scares lenders and makes them think you have used almost
all of your available credit. Aside from quickly paying down your the debt, a person who
who has maxed out his or her credit limits should try to create a cushion, instead of
having four cards maxed out at $ 3,000 each, move some of the money to a card that
is not near its limit. Or open a low rate credit card account and move some of the debt
there. The idea is to spread out the debt. You also want to keep an eye on how much debt
in relation to your income. If your unsecured debt, such as credit cards, is 20 percent or
move of your income, that is to much and can cause trouble for you in securing a good deal
on a loan.
It's there for seven years.
Most reports will summarize haw many potentially negative items exist on your
report. In general, negative information stays on your report for seven years. Exceptions
include some bankruptcies, such as a chapter 7 filing, which will appear for 10 years
before dropping off your record. A chapter 13 filling stays for seven years. Other types
of negative information that could appear on your report:
Delinquencies: These remain for seven years from the dismissed payment date. They stick
around even if you later bring your payments up to date. Charge offs. A charge off means a
creditor decided to write off the account as a loss. These accounts stay on your report for
seven years from the date of the initial missed payment that led to the charge off. This
is true even if payments are later made on the charged off account.
Collection accounts. These accounts, in which the creditor has turned over your bill to a
collection agency, stay on your report for seven years from the date or the initial missed
payment that led to the collection, even if you later pay it in full. When a collection
account is paid, it will be marked paid.
Is my spouses credit report part
of mine?
No. Each person has his or her own separate credit report based on Social
Security number, name and address. You may share joint accounts, which appear on both your
records.
Do the reporting agencies rate my
credit?
No. They just compile the information. they do not rate or grade credit.
Who can see my credit report?
The law is very specific about who can view your credit history. Under the Fair
Credit Reporting Act, business must have a legitimate business need and a permissible
purpose to get your file. That covers business such as lenders, insurance companies and
collection agencies. An apartment manger also has access to your record as part of the
rental application process. Otherwise, only you and those to whom you give written
permission can access your report. For example, if employers want to see credit records,
they must get written permission from their employees. |