As part of series of articles (blogs)
regarding Credit and Credit Score, here we
Every effort has been made to make these
articles as complete and as accurate as
possible, but no warranty or fitness is implied.
The information provided is on an “as is” basis.
The author shall have neither liability nor
responsibility to any person or entity with
respect to any loss or damages arising from the
information contained in this book.
The author is not engaged in professional
services. If professional advice or other expert
assistance is required, the services of a
competent professional person should be sought.
Home ownership is part of the
American dream. If purchasing a house is the next
step in your many life stages, you’ll need to start
well in advance to prep your credit before visiting
If you are buying a home sometime soon and have
plans to apply for a mortgage loan, follow these
Do’s prior to applying for a Mortgage Loan:
About two months (if you know you don’t have any
credit issues and your credit score is good) or
10-12 months (if you know you have some credit
issues OR don’t know about your credit reports or
scores) prior to applying for a Mortgage loan, get
hold of your free credit reports from the three
major credit bureaus in the United States; Equifax,
Experian and TransUnion.
You can request your credit reports via phone, mail,
or online from each bureau. Optionally, you can also
request your credit score from each bureau by paying
some fees. There are also many websites that provide
you with reports and scores and monitor your credit
for a fee, however, most of them offer a one-month
free trial. See the “What
is a Credit Score” section of this book
to find out how and where you can request your
credit reports and scores.
Remember, you can request and get your credit
reports without affecting your credit score as many
times you want. However, usually you are only
entitled to one free report from each credit bureau
in a year. You may be entitled to more than one free
report, if you meet certain criteria’s.
After getting your credit reports, well in advance,
do the following:
Check and report for correction any
inconsistencies, inaccuracies, missing information
or credit history, the negative items that should
have been removed or deleted, etc.
Try to negotiate with creditors and resolve
issues regarding negative items as much as possible.
Pay and continue to pay all your bills (at
least the “Minimum Payment” on Credit Cards) and
loans on / or before the due dates.
Look at each credit card’s Balance/(Line of
Credit) ratio and pay as much as possible to reduce
the unpaid balance to a point that the ratio becomes
less that 33%.
Have a good cushion of available credit
between your current balance and your credit limits
on all open trades
From time-to-time, request a soft
credit line increase. Typically, creditors can
increase your line of credit a couple of hundreds or
thousand dollars without running your credit report,
if you have had a good payment history and/or good
relationship with them for a year or so.
Use (e.g., charge at least some amounts) all
your credit cards including those that you usually
don’t use every month and of course pay them back on
Pay off smaller debts.
If you don’t have any credit card or credit
history, you need to establish a credit history.
E.g., apply for and get secured credit cards,
department store charge cards, use them wisely and
pay your bills on time. It takes at least six-twelve
months for these new cards histories to show up in
your credit reports and show you have established a
Repeat above steps about 2 months prior to
applying for a Mortgage loan. Get hold of your free
credit reports from three credit bureaus again and
go through the same steps as above until you have a
good credit history and credit score.
HOW to overcome the problems with your credit
history and credit score?
Knowledge, education, awareness, practice and
discipline are the essential keys to being
successful on any subject. The book,
"Credit Score Tips and Tricks",
provides you information, tools, techniques to
educate yourself and manage your credit report &
credit score, and therefore manage your finances
effectively at no additional cost.
I have decided to bring and share with you,
chapters or sections of my book,
Credit Score Tips and Tricks,
as series of
articles here. This is the number
28.1 of such a
I also created and manage a GROUP in ActiveRain,
Credit Reports and Credit Scores, Please
feel free to join and share your thoughts and
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