Credit Repair Tips

Credit Repair Tips

If you have decided that you want to buy a home in the near future it is very important that you get a copy of your credit report and review it for errors before you apply for a home loan. The sad reality of modern banking is that your ability to apply for and get a mortgage is very dependant on your credit score. If your credit score is low you’re financing options will be limited to mortgage for poor credit. Use these credit repair tips to hep you improve your credit score

Credit Repair Tips

It is relative easy to get a copy of your current credit report from each of the three major credit reporting agencies, Equifax, Trans Union and Experian. Simply by going to AnnualCreditReport.com and requesting your credit report it will be made available to you to view online for a 30 day period. They will try to up sell you but keep clicking to free option and you will get your credit report for free. If you also want your credit score you will have to pay a fee of less than $10. When you have your credit report you can use your credit repair tips to understand how a credit report works.

For the purposes of examining your credit report in advance of applying for a mortgage your credit score is not important. The credit score is a number that is computed based on the information contained in the credit report. Lots of negative information equals a lwo credit score which is called bad credit. Your credit repair tips will help you to repair your credit score.

Credit Repair Tips-Bad Credit

Credit Repair Tips

When you get your credit report look for items that are negative and review them to ensure that they are correct, if you find items that are incorrect on your credit history you can dispute them and if the credit bureau cannot prove the correctness of the disputed item they must remove it.

Check for late payments and call your or write to the lender associated with the late payment asking them to remove the late report from your credit report. It is essential that your account is in good standing and current if you are making this kind of request. Write a polite letter explaining that you sent the payment on time but that a postal delay out of your control caused the payment to arrive late and now that you are applying for a mortgage it would be really great if they could review your account and how it is reported to the credit bureau.

Check for charge offs and judgments. It is possible that something forgotten like an old cell phone bill for a few hundred dollars is having a dramatic effect on your credit score. If you find items like this arrange to have them paid off and as part of the payment negotiate the removal of the negative entry from your credit report. This one is one of the best credit repair tips.

Credit Repair Tips-Credit Cards

A really great way to enhance your credit score is to ensure that none of your credit cards are maxed out. Even a credit card with a $500 limit that is running a $450 balance will have a really bad affect on your credit score. A basic of the credit repair tips is that if you max out your credit cards your credit will suffer. You are better off having a few extra credit cards with low balances that just one or two with high balances.

Try to keep your credit to debt ratio less than 50%. It is far better to have a card with a $2500 limit running a $450 balance than a care with $500 limit running a $450 balance.

Keep you total credit card balance at less than 50% of your total available credit. Make sure that your balances are spread around your credit cards so that no individual credit card is running a balance of more than 50%.

If you are running large balances arrange to pay them down before applying fro a mortgage. Merely by paying down your outstanding credit card balances to less than 50% of the credit limit you will improve your credit score by up to 50 points. This could be the difference between you getting a great interest rate or having to settle for a mortgage for poor credit. If you utilize these credit repair tips in tandem with your credit report you should be able to improve your credit score.