Raise That Credit Score!!!

Financing is important in many areas of real estate. Including with investing. Whether you are buying a property to live in, or buying a property to hold on to as an investment property, financing can make or break good/great deals. So doing everything you can do to boost your credit score is going to make a big difference if you’re looking to hold onto properties for cashflow.
I found a great article that gives a few simple ideas of things you can do in order to raise your credit score. I hope you get a few ideas from this like I did. Enjoy.
Boost Your Credit Score to Buy a Home
Buy, Credit Score, Finance
By: Michele Lerner

Promises of loans for bad credit borrowers, while common amid the housing boom in the early 2000s, are now rare. If you’re interested in buying a home today, know that lenders will carefully check your credit and will rarely approve a loan for someone with seriously bad credit.
For that reason, it’s important to check your credit report and your credit score. Many consumers are surprised (pleasantly or unpleasantly) by their credit score and many find errors on their credit reports. Carefully review your credit report and focus in particular on negative items to see if there are ways you can address them and improve your credit profile and your access to a mortgage.
Credit Scores and Lenders
A lender can be a great source of advice about your particular credit issues and can tell you what minimum credit score is needed for a particular loan program. Different lenders have different loan standards, so while one lender may reject you if you have a credit score of 640, another could give you a loan approval.
In general, FHA-insured loans have lower credit score requirements than conventional loans. In addition, the FHA has loan programs that make it easier for some people who lost a home in a short sale or a foreclosure to get a new mortgage faster. While FHA loans can be easier to qualify for if you have damaged credit, the downside of this loan program is that you must pay mortgage insurance on the loan, usually for the life of the loan. FHA mortgage insurance is typically higher than private mortgage insurance that you must pay for conventional loans if you make a down payment of less than 20 percent. Private mortgage insurance is automatically cancelled when your loan-to-value ratio reaches 78 percent.
Conventional lenders base their interest rates on your credit score, among other factors, so if your credit score is above 740 you’ll pay a slightly lower interest rate than someone with a credit score of 700.
Lenders look at many factors when evaluating you for a mortgage loan, including your debt-to-income ratio, your income and assets, how much your down payment will be and your job history. These compensating factors can sometimes help you overcome a slightly low credit score, but your best chance for a loan approval is to improve your credit score.
Boost Your Credit Score
While there’s no quick fix for bad credit, taking steps to improve your credit profile can raise your score over time:
• If you have any collections or judgments against you, pay them off as quickly as possible.
• Bring your over-the-limit and past-due accounts up-to-date.
• Pay all bills on time.
• Try to reduce your credit card debt to 25 percent or less of your credit line on each card.
• Don’t open new lines of credit.
• Don’t close your credit card accounts because then you’ll be using more of your overall credit limit.
• If you have an old credit card that you haven’t used in awhile, you can use it and then pay the bill in full to show that you can responsibly handle credit.
A reputable lender can suggest specific actions such as which credit card bill to pay off if you can’t eliminate your debt, so it would be a wise move to visit a lender as soon as you’re considering buying a home.
Hope this helps!

Happy Investing!

Matt W.