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Millennials: How to Establish Credit Quickly and Easily

Reblogger
Real Estate Agent with United Real Estate Dallas TREC# 0544069

Gene Mundt's educational post about establishing credit is packed with information for anyone who needs to establish credit or improve their credit score. If you live in the Chicago area, Gene should be at the top of your list when you're in need of a knowledgeable and experienced loan officer to help you secure a home loan.

Millennials: How to Establish Credit 
Quickly and Easily      



     Credit ... Credit Scores ... they're a big issue, no matter someone's age ...
    

   

     But for Millennial-age hopeful home buyers, credit-related issues are of particular interest and importance these days.  I'll add they may be a bit frustrating too ...

     It's been very well-documented:  The job market and financial problems have dogged Millennials.  


     As a result, many have poor credit.  Or have avoided accumulating debt entirely.  They pay cash for every purchase or bill they have.


     Each credit issue presents its own challenge.  Decidedly so when they decide to buy a home.  


     The challenges associated with bad credit are fairly obvious.  For those Millennials that have established no credit?  They're often mystified, as the challenges they face seem to defy old-fashioned credit logic.


     How's that?  


     Today's credit reality is:  You must already have credit to successfully gain more credit to buy a home.


     How that's best accomplished:


  • If there is absolutely no credit/no credit card, obtaining a Secured Credit Card is a good first option.  

      

      Secured Credit Cards can be established with deposits of smaller amounts of money ... often as little as $250 to $500 ... at a bank, credit union, or online Creditor.  Money is deposited at the bank (or credit union) and held in an account used to back the secured card.  

  • Acquire a Credit Card.  Opening/using a Credit Card remains the easiest and fastest way to establish and build credit.  

      

     Fact:  Establishment of 2 (sometimes 3) forms of trade-line/credit  (Revolving, Student Loans) is needed by home buyers prior to applying for Mortgage, in most cases. 

      While the Down Payment made on a home purchase (plus others factors associated with the individual applicant's borrowing scenariomay effect the length of credit history demanded prior to application for Mortgage, typically each line of credit must be 1-year old or more. Those timelines may be shortened with larger down payments of 20% or more.


     It's also important to:

  • Keep credit balances low. (30% of available credit limit is optimum.  50%, including finance charges, is maximum)
  • Make all payments on time.   
  • Establish Credit Cards/Credit History well in advance of applying for a Mortgage.  (A minimum of 6 months of payment history is needed before credit agencies even report them. It takes time to establish a "documentable" history.)  
  • Don't co-sign for someone else's loans, leases, credit cards, cell phones, etc. 

     

     Co-signing is an issue that seems to crop-up fairly often for Millennials. And while I understand the emotional tug of helping a friend or family member, they must resist.  

     Too often, co-signing causes severe damage to an Applicant's Credit Scores.  Damage that creates additional credit issues to be addressed/resolved and possible derailment of home buying dreams (at least in the short-term).


     For Millennials dreaming of buying a Chicagoland home in the future, it's wise to start on establishing credit now.  Ask your questions and take action soon.  


     Contact me.  Together we'll get started on a plan that fits your personal financial scenario and time frame for buying a home. 


     I can be easily found at:

Direct:  815.524.2280
Cell/Text:  708.921.6331
eFax:  815.524.2281

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Gene Mundt

Mortgage Lender  -  NMLS #216987  -  IL Lic. #0006220  -  WI License

American Portfolio Mortgage Corp.

                                                                    

NMLS # 175656

 

Gene Mundt, Mortgage Lender, a Lender with 37 years of #mortgage experience, will offer you exemplary mortgage service and advice when seeking:  #Conventional, #FHA, #VA, #Jumbo, #USDA, and Portfolio Loans in #Chicago and the greater Chicagoland region, including:  The #Lincoln-Way Area, #Will County, (#New Lenox, #Frankfort, #Mokena, #Manhattan, #Joliet, #Shorewood, #Crest Hill, #Plainfield, #Bolingbrook, #Romeoville, #Naperville, #Wilmington, #Peotone, etc.), #DuPage County, the City of Chicago, #Cook County, and elsewhere within IL and Wisconsin. 

Contact Gene Mundt, Mortgage Lender Today!

 

Your Referrals are Greatly Appreciated!

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Posted by

 Sharon Parisi,  Realtor®

Helping Dallas area buyers and sellers meet their real estate needs

214-450-3742

Sharon@sharonparisi.com

United Real Estate

Comments (1)

Endre Barath, Jr.
Berkshire Hathaway HomeServices California Properties - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Sharon what a nice re-blog and a great shout out for Gene, Endre

Jun 19, 2015 03:39 PM