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Learn How You Can Fix Your Credit Before Buying A New House
ost people think - But just because you've had some
mistakenly - that if you money problems does NOT mean you
have credit problems, you can't get a mortgage and buy a
have to wait 7 years for them to house. There are all kinds of
go away. loans:
Well, that's not always true. • loans for first time
homebuyers
Credit repair can help you...once • loans for people with bad
you know how to do it. The time credit
to clean up your credit and pay • loans for people with perfect
off your debts is RIGHT NOW, credit
before you start looking for • and loans for people without
houses and applying for a lot of money for a down payment
mortgages. Cleaning up your
credit and lowering your debt
will help you: So, most people can get a loan
these days. The question is, HOW
• get a better interest rate MUCH will you pay in the long run
• borrow more money for higher fees and interest
• and save lots of money in rates?
interest
A lot of people think that if
Clean Up Your Credit Report something bad goes on your credit
report, that it must stay there
These days, getting credit is for 7 years, or longer. But
easy. Unfortunately, so is that's not always true. Credit
getting into debt or financial repair can work, if you know how
trouble. to do it.
And, you can do it yourself. credit reports.) The worst that
can happen is that the credit
For example, I had lots of debt bureaus can say "no" to your
(from a business idea that did request. The best that can happen
not work) and got a lot of bad is that your credit score will
credit listings while getting improve, and you'll pay a lower
myself out of debt. interest rate, get a bigger
mortgage, or both!
And within 6 months of paying off
my last credit card bill So, how do you clean up your
(remember, even if you have some credit report?
debt you might still be able to
get a house loan) I repaired my The first step is to get a copy
credit to the point that I got of your credit report from the 3
both a car loan and a mortgage. credit bureaus, listed below. You
More importantly, I got the might have to pay a few dollars,
LOWEST POSSIBLE interest rates, but it is well worth it. If you
which over the life of a 30-year moved, changed jobs, and had any
loan could save me tens of other personal info change
thousands of dollars! recently, you can send it to the
credit bureaus, and request a
How did I repair my credit? free copy.
I got a copy of all my credit NOTE: You are now entitled to one
reports, and kept writing letters free credit report each year from
asking the credit bureaus to http://www.annualcreditreport.com
remove the bad credit. .
So it CAN be done. (And I had The next step is to circle or
some pretty bad stuff on my highlight the bad credit items,
and write a letter to each credit
bureau asking them to remove the Then Pay Off As Much Debt As
item. If you have a lot, focus on Possible
one or two at a time.
I know, when preparing to buy
Then, wait a month or two, and your new home money is real
ask for another one or two items tight. But if you have any extra
to be removed. money - any at all - try to pay
off as much debt as possible.
It might take a few tries. This will help you:
But if you keep trying, • Be more likely to be approved
eventually most (or all) of the for a mortgage
items will be removed. • Be able to borrow more money
In the worst case - even if you • Have one (or more) less bill
only get a few removed - it might to worry about once you start
still improve your credit score, having to pay a mortgage every
reduce your interest rate, and month.
lower your monthtly payment!
If you can't pay off your debt,
So don't give up. you might want to consider
waiting before buying your new
It might take a little time to home. Or, look into a debt
repair your credit - especially reduction program that can help
if you've had quite a few money you get out of debt faster.
problems. But every little bit There are no rules that say you
helps your credit score, your can't have some debt and still
interest rate, and the amount of buy a house!
money you can get.
But think very carefully about
your financial situation. And TRY At the very least, if you do have
to pay off as much debt as any debt, MAKE SURE you can
possible before buying a house. comfortably afford to pay your
There is enough to worry about as credit card bills as well as your
a new homeowner, without having mortgage, before getting started!
to worry about paying your credit
card bills.
About the Author:
Kris Bickell is the owner of HouseBuying-Tips.com, a site that helps first time home buyers avoid the costly mistakes that many new homebuyers make. For more tips on buying a house, getting a mortgage, finding a realtor, and getting out of debt, sign up for the free "How To Avoid These 10 Costly Mistakes When Buying Your First Home" email course at: http://www.HouseBuying-Tips.com/course.html. "© 2005 HouseBuying-Tips.com
Source: www.isnare.com
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