I got an email the other day. Here is what it said:
I am wanting to relocate to Michigan and basically start over. I am looking for information on buying my first Michigan home and any other programs that might help with my Michigan relocation. My credit is poor. I am setting a goal to move later in the year or beginning of next. Once I find a good job out there and get my living situation together, I'm out of here. If you could help me with any information you can along with mortgage information, I would greatly appreciate that.
I replied to them and then realized that this could help many people out there. Here is what will help this family get back on the path to home ownership.
The main key now is to get your credit back on track. It is impossible to buy a home with out decent credit. FHA will be the way to go for you.
Here are the steps you need to take to rebuild your credit score and rebuild your credit.
- Get your credit report pulled ( all 3 bureaus) with credit scores.
- Correct all the mistakes on the credit report. Go through the credit report and contact the credit bureaus with any mistakes.
- PAY EVERYTHING ON TIME FOR ONE YEAR MINIMUM FROM THIS POINT ON. Your credit score is based on your credit history. FHA will not do a loan unless you have a year of good history. NO lates, no new collections, no new judgments.
- If you have little or no credit. Get 2 secured credit cards. Charge your groceries or gas on it. PAY IT OFF ON TIME EACH MONTH!!!! In order to improve your credit score you must have open credit lines... So get something with credit and build your credit history. If you have no open credit lines you will keep the same credit score.
- If your parents or your spouse has good credit ask them to add you to the account as an authorized user. (This helps build your score based on the account being paid on time for a long period.) Don't let them give you a card or even use the card. You are just doing this to get a higher score.
- If you are renting make sure you are paying the rent by check. Keep copies of the check. Paying by cash is no good. We need canceled checks to help get the loan through.
- If you have little or no credit history we sometimes can use alternative trade lines. What that means is that we can use your history of cell phone payments, utility payments, car insurance payments. So get those things in your name. AND PAY THEM ON TIME!!!!!
START THIS TODAY, NOT TOMORROW, NOT NEXT WEEK. Your year has started. The longer you delay the longer it will take to re-build your credit. I once had bad credit when I was younger, many people do. So don't be ashamed. You can change your habits and get back on the right track.
Having a good credit score will save you thousands of dollars in lower interest rates. Good luck and start working on these steps to rebuilding your credit and credit score.
Have a great day. Russ Ravary
For more Michigan mortgage information, Michigan real estate information go to my websites www.RussRavary.com or www.DetroitMichiganRealEstateHomes.com
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