Mortgage Lender with the score in Illinois

A good credit score can actually save you money.  Interest rates are lower for home buyers with good credit scores.  In the eyes of a mortgage lender you are less of a risk the higher your score.  Borrowers with lower credit scores will usually end up paying a higher interest rate on mortgage loans. 

There are several things you can do to help your credit score.         

Charge off and past due balances -

Paying a charge off or past due balance will only help your credit score if the charge off or past due has occurred in the last two years.  Any item on your credit report that has not updated in the last two years should be left alone.  Paying these items can actually lower your credit score.  Anything over two years old has much less effect on your score than something within the last 24 months.

Closing credit card accounts -

You should leave credit card accounts open even if you are not using them.  Part of your credit score is based on credit history.  The old cards still give you the benefit of history. 

Try to keep balances as low as possible.  Balances lower than 30% of the available credit limit has a greater impact on raising your credit scores.  You can also try to speak with your credit provider about increasing your line of credit.  This will help by improving your ratio of debt to available credit.

Errors on credit report -

Any errors on your credit report should be requested removed by the credit bureaus.  Once the credit bureaus receive your request, they are required to rectify the incorrect items within 30 days. 
Any items on your credit that are less than two years old should be paid. 

The three main credit bureaus are Trans Union, Equifax, and Experian.  You can contact them at:

Trans Union

800/ 916-8800

http://www.transunion.com/

Experian

888/ 397-3742

http://www.experian.com/

Equifax

800/ 685-1111

http://www.equifax.com/

You can obtain a free credit report at www.annualcreditreport.com.  You will not receive your credit scores with this free service however for an additional fee you can get that information. 

If you are looking to buy a home or refinance a current home and would like an evaluation of your current credit, contact a mortgage professional. 

Kim Murphy

1st Advantage Mortgage

Providing home loans for DuPage, Kane, Lake and Cook Counties for over 10 years