When your mortgage application is considered, there are four major points that are considered.
1. Your employment history: Lenders want to see a solid employment history.
2. Your credit history: Lenders look for a solid credit history that includes a good credit score.
3. Your down payment: You need to be able to show that you have your down payment.
4. Your debt/income ratio: Lenders want to see a good debt to income ratio. They need to be sure you are capable of making your monthly payment.
Here are 5 tips to boost your credit score.
1. Lower credit card balances: If you have high balances on your credit cards, pay them down. Don’t request to lower your credit limit, but keep those balances low.
2. Pay-off outstanding collections: If you have outstanding collection bills, pay them off.
3. Stop spending: Many potential homeowners make the mistake of purchasing items for their new homes before they’ve been approved for a mortgage. Wait until after you’ve closed on your mortgage to make big purchases.
4. Check your credit report: Make sure your credit report doesn’t have any errors on it. If it does, work to get them off as quickly as possible.
5. Improve your debt/income ratio: Reduce your monthly debts if possible. Pay off any school loans, car payments, medical bills, or other monthly payments.
Contact the mortgage specialists at Midland Mortgage Corp. today to determine if you’re ready to qualify for a mortgage.