One of the most important factors when applying for a mortgage is your credit score. When you apply for a mortgage, your loan officer takes a look at your current credit score and determines how big a credit risk you are. Before starting the journey to becoming a homeowner, it’s a good idea to become familiar with what exactly a credit score is and how you can improve it.
We created a list of the basics you should know about credit scores. Check them out:
- What is a Credit Score?
A credit score is basically a measure of your credit risk. An institution lending money is less likely to take a chance on someone who may not be able to pay back their loans on time and in full. If your credit score is less-than favorable, the only thing you can do is try to clean up the damage and be patient. Learning as much as you can about credit as early as possible will help you make the right decisions moving forward.
- How Do You Get a Copy of Your Credit Report?
Because your credit report belongs to you, you have a right to receive a free copy of it. Since December 2003, all reporting agencies are required to give you a free copy of your credit report each year. By looking at your report, you can check for accuracy, discover debts you may be unaware of and create a strategy for improving your credit score. Keeping up to date with your credit report will ensure there are no surprises when it comes time to apply for your mortgage. You can get your free credit report by visiting AnnualCreditReport.com.
- How Do You Improve Your Credit Score?
If your credit score isn’t where you want it to be, there are a number of things you can do to help improve it. By consistently making payments on time, paying down your debts and being patient, you can improve your credit score. Remember, these things take time but it will be all worth it when you apply for a mortgage.
- Why is a Credit Score Important?
Learning about your credit score and understanding how it works can help set you up for future success. Credit scores are used in many situations where you borrow money and sometimes apartment managers or employers look at your score, too. Having no credit or bad credit only makes navigating the world more difficult.
If your credit score isn’t perfect, don’t worry. There are things you can do to improve it over time. If you are looking for a home or are interested in refinancing your mortgage, call 1-844-77-vLoan or get a free rate quote to explore your options.