How’s Your Credit?: Before You Buy A Home, Be Prepared!

You’ve decided, it’s time, for you, to buy, a home, of your own! After all, it’s a major component of the American Dream, but, until/ unless, one proceeds, in a well – prepared, well – conceived, objective, introspective manner, that dream, may, potentially, become a nightmare! What are your reasons, for buying a house, and how, can a specific one, meet your current needs, as well as those into the foreseeable future? Are you, ready, and prepared, from a financial perspective? Many fail to consider, all these aspects, which includes, current, liquid assets, on hand (in order to afford the needed, down – payment, and the reserves, generally required, by lending institutions), as well as the financial necessities of owning a house, which includes, not only monthly mortgage payments (including principal, interest, and escrow items, including taxes, etc), etc. However, before you can proceed, you must, first, consider, identify, and review, your personal credit, etc. With that in mind, this article will attempt to briefly review, consider, and discuss, some of the relevant considerations, and necessities.

1. Credit considerations: Acquire a copy of your credit report, and, either, review it, yourself, or, seek professional assistance, etc. Are there any errors, which have negatively impacted, your score? Are there, other aspects, which need your attention, in order to get a better rating? Remember, your credit worthiness, will, not only, affect whether you qualify for a mortgage, but, also, if you will receive one, with the most favorable terms? Ignore these, and you will suffer, financially!

2. Correct errors: If you see, an error, contact the lender, and the credit bureau, and seek, it be corrected. You can do this yourself, or hire someone, to help you, achieve your objectives.

3. Review the report thoroughly: A careful review, of one’s credit report, will indicate, both, the strengths, and weaknesses, of your credit worthiness. Reduce the balances on your loans, and do so, wisely, and in an organized manner! Your report will indicate how that score, was developed, and how it was weighed. Some of the considerations, generally, include: payment history/ timeliness; balances, especially as a proportion/ ratio of credit lines (if you ensure the outstanding balance on each account is less than half the available credit, your credit usually improves); overall amount of credit available (not too much, or too little); etc.

If you want to enjoy, the American Dream, proceed wisely, in a well – considered manner. An ounce of prevention/ preparation, makes your life, far less stressful!

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