The mortgage rate you qualify for when refinancing your mortgage is heavily influenced by your credit score. Your credit score is derived from the contents of your credit reports and improving your credit score is easier than you think. Here are several tips to help you improve your credit score before applying for mortgage refinancing.
Credit records in the United States are maintained by three separate credit agencies and records are frequently prone to errors. The three credit agencies that maintain your records are Experian, Equifax, and Trans Union; you can request a copy of the records from each agency by visiting the website AnnualCreditReport.com. Congress recently passed a law requiring these agencies to provide you with a free credit report every year and this website was established to comply with the law. When you visit AnnualCreditReport.com to request your reports each agency will try and sell you a credit score when generating your report; however, you don't need to purchase it when refinancing your mortgage.
Once you've requested your credit records from each reporting agency you'll need to carefully review the reports for errors. If you find errors you need to dispute the error with the individual credit agency. Also, if you have negative information in your credit records such as judgments or write-offs you need to settle with the creditors to have this information removed. Having negative information in your credit report will significantly reduce your credit score and negatively impact your ability to qualify for a competitive mortgage rate.
After you've reviewed your credit records and ensured that everything is accurate, there are steps you can take to improve your credit score before applying for mortgage refinancing. Start by paying all of your bills on time; 35% of your credit score is based on your history of on-time payments. Also, try and maintain low balances on your credit cards. The less outstanding debt you have when you submit your mortgage refinancing application, the better your mortgage rate will be. You can learn more about qualifying for the best mortgage rate by registering for a free mortgage tutorial.
To get your FREE six-part Mortgage Refinancing Tutorial, visit RefiAdvisor.com using the link below.
Louie Latour specializes in showing homeowners how to avoid costly mortgage mistakes and predatory lenders. To get your hands on this free video tutorial: "refiadvisor.com Mortgage Refinancing - What You Need to Know," which teaches strategies for finding the best mortgage and saving thousands of dollars in the process, visit Refiadvisor.com.
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