A Low Credit Score Can Affect Your Purchase of a Home

Purchasing a Home vs. a Low Credit Score

When your credit report is being reviewed in connection with a mortgage application, the lender will most likely have these questions on his or her mind: Is their credit score acceptable? Is their credit history good? How much income do they have? How much of a down payment will they be providing?

The negative effects of a less than stellar credit history may be minimized by a large down payment; however, you will still likely pay more in fees and end up with a high mortgage interest rate. The fact is that in the past 12-18 months the minimum score necessary to buy a home has increased.

There is no way around having a low credit score. Even with a large down payment you will still need a good credit score to make home ownership a reality. Your goal should be a 758 average credit score to qualify for the lowest interest rates, according to CNN.com.

Find Out How to Raise Your Credit Score and Improve Your Chances of Purchasing a Home

It is easy to get a copy of your credit report and review its contents. Many times there are entries which are inaccurate and can be disputed.

A dispute letter to the relevant credit bureaus would be a good start. Alternatively, to resolve the negative entry, you will need to contact the creditor directly.

Sometimes a cleverly crafted dispute letter will result in the removal of the negative entry. However, it is often the case that investigative procedures are careless and result in errors.

This is because credit bureaus must spend potential profits on time and resources to investigate any dispute. The unfortunate truth is that some credit bureaus have found it cost effective to delay or ignore your dispute. Their hope is that you will give up on your dispute.

Will it Take Long to Boost My Credit Score?

Many people want to know how long it will be before they can see a difference in their credit score. In most cases, a fair estimate would be 6-12 months.

This is a long time but it certainly beats 7-10 years for the negative information to be dropped. It is beneficial to wait 6-12 months to raise a low score, especially when purchasing a home.

We raised our credit scores from the upper 500 range to 745 and 763 in under six months and got approved for our dream home. See proof of our credit repair success at www.creditforcouples.com and get the real truth about lexingtonlaw.com.

This entry was posted on Saturday, November 28th, 2009 at 4:09 am and is filed under Credit Repair. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.