Mortgage ArticlesHow Your Credit Scores Affect Your MortgageBankruptcy Mortgage Book. How To Qualify For A Home Mortgage After A Bankruptcy. The most wonderful times in your life cannot compare to the pleasure of owning your own home. Especially when it's your dream home, even the purchase of your first home is exciting. Although it's one of your greatest pleasures in life it's also one of the most stressful and emotional roller coaster rides you can be on. The stress come from the mortgage or loan process, since we live in a world where most people cannot afford to pay for their home using cash they use the power of leverage and credit. This credit obtaining process causes most people to feel confused and anxious, due to the complicated process. Two of the major unknown factors in obtaining a mortgage are getting the mortgage approved and the interest rate offered to you by your broker. Both of these factors are heavily weighted by your personal credit score and history. The better your credit score or fico score the better your overall chances of approval are. What are the differences in good, great or horrible credit scores? This is a very good question yet it has no one particular answer. Banks and lending institutions have their own rules and definitions related to credit scores. This is why there are literally thousands and thousands of different mortgage products available to you today. Your credit scores are calculated by using a very complicated algorithm (mathematical calculations) that measures different variables; payment history, amount of available credit compared to your high credit limit, length you carry debt and many more. Any negative pieces of information on your credit report reflects on your score and the amount it can lower your score depends greatly on the variables associated with your credit history. The heavy score droppers are collections, bankruptcy, consumer credit counseling, and foreclosure. Let's not forget that divorces and family emergencies can also take a toll on your credit although not directly to the credit bureaus; the actions that take place from that point forward can have a ripple effect or butterfly effect if you are not careful. Keeping a good credit history has far more benefits than negative credit any day. The most important is how much money you will save. Since credit is becoming more and more mainstream you need to keep on top of yours. Pay your bills on time and never over extend your finances. Develop a good understanding of your personal finances and creditworthiness and you will be far ahead of the pack. Monitor your credit as often as possible we suggest at least once every 6 months at a minimum.
|