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Plan Ahead for a Mortgage!
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by: Dave Saltonstall
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Word Count: 431
How can home-buyers get a mortgage in this market?
The mortgage industry is experiencing unprecedented losses. To protect themselves they are tightening up the restrictions on applying for mortgage loans. This is making it difficult for buyers, whom in the past had no problem qualifying for a loan, to qualify for a simple home loan. Buyers can combat this problem by planning ahead.
If you would like to get a loan you should first check your credit, you can do so by using an online service. If you have not received your credit report in the last year, you qualify to receive one for free. Look up free credit report in an online search.
Once you have your credit report and score find out what those numbers mean to lenders today. Call a local lender and ask them what they consider to be a good credit score for receiving a loan. If your credit does not meet their criteria you can try other mortgage lenders or you can work on improving your credit score. Many times there are small things that you can do to repair your credit score. You can dispute any incorrect or inappropriate marks on your credit. You must do this with each of the three major credit rating companies, Transunion, Equifax and Experian. It is worth the effort to take the time and do it right. Later it will save you a lot of money.
You can also help your credit by paying down your debt. Firstly seek some free debt advise. If you have credit card debt, try to pay it down until you owe only 30% or less of the total amount of credit available to you. For example, if you have £10,000 worth of credit on all your cards, pay them down until you only owe a total of £3,000 or less.
Creditors do like you to owe money on your cards, they just do not like it to be more than you can afford. Once you have your credit score in a range that you are comfortable with, hopefully over 680, you can start applying for mortgage loans.
Every time you apply it is an inquiry on your credit, so inquire about all of the details of a loan before you submit an application. Find out what the interest rate will be, the length of the loan and whether or not the rate is adjustable or fixed. Fixed rate loans are preferable for long time owners. Adjustable rates are good for short term owners.
About the Author
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