Home Buying Advice: The Role of Your Credit Report

Article posted by Jerry Armen.

If you’re in the market for a new home, you will eventually have to shop around for the right lender. While it’s smart to be picky about choosing a lender, you might be surprised to find out that lenders are even pickier when it comes to you. Not everyone gets approved for a home loan.

According to real estate agent Jerry Armen, one of the most important factors lenders consider is your credit score. Also called a FICO score, your credit score determines which loan options and interest rates you will get. It can also determine whether you can get a loan at all.

For potential home buyers, there are many benefits to having a high credit score. A good credit report is a good indication that you will take your mortgage seriously and pay it on time each month. However, a poor credit score can make it extremely difficult, if not impossible, to qualify for a loan.

In addition to having a better chance of qualifying for a loan, a good credit score might also help you get a better interest rate, saving you money in the long run. A good, higher credit report might also convince your lender to take a lower down payment.

What’s a good credit score? Jerry Armen recommends aiming for a credit score of 700 or more. A poor credit score is around 300 points, while the highest you can achieve is 850 points.

What is your credit score? Before you start shopping for a home, find out your credit score. You can get your score through access to three of the top credit reporting companies: TransUnion, Equifax, and Experian. You can also find sites that offer free credit reports.

Once you know your credit score, you can begin to take steps to improve it. Lenders look at your credit history as proof of how you will handle your debts in the future, which is why it is so important for you to raise your score if it is low or not as high as it can be.

To improve your credit score, start by paying your bills on time, if you’re not already doing so. In addition, you can closely evaluate your credit report for errors. If you see any errors on your credit report, contact the credit agency and take the necessary steps to dispute the mark on your credit report. To get more real estate advice, please visit jerryarmen.org.

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