Tony Chau, AMP
Mortgage Agent
FSCO Lic # M09000861
Direct: 647.219.1697
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Get the Latest Mortgage News & Tips !
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Credit Reports
A credit report is a summary of your credit history and it shows how consistently you pay your financial obligations.
It includes:
Your payment history
The amounts you owe
The length of your credit history
Your New Credit
Your Credit Accounts
Employment and other personal financial information
Having a good credit history and a good credit score is very important when you want to purchase a home. Why ?
If you have a good credit score, you will speed up your mortgage approval process, and at the same time you might be able to have a lower
interest rates on your loan ! If you have a poor credit score, you might have to pay a higher interest rate on your loans,
or in the worst case, you might have your
mortgage application turned down.
Going directly to different banks or lenders to shop for a mortgage may hurt your credit score. Each lender will pull their own
credit report on you for your application, and this may affect your credit score if there are too many credit report inquiries were made.
As your mortgage agent, 1 credit report is all that is required for me to shop for the best mortgage for you.
Tips On How to Improve Your Credit Score
Always pay your bills on time. Late payments play a major role in driving down your score.
If you have past-due bills now, get current and stay that way.
Contact your creditors as soon as you know you will have a problem paying bills on time. Try to work out a payment arrangement and negotiate with
them to keep at least a portion of the late notations off of your credit reports.
If your situation is serious, see a legitimate, non profit credit counselor. Avoid the scam artists who promise a quick reversal
of your credit problems.
Keep Your Debts to a Minimum.
Keep your credit card balances low. High debt-to-credit-limit ratios drive your scores down.
Pay off debt, don't move it around. Owing the same amounts, but having fewer open accounts, can lower your score if you max out the accounts involved.
Don't close unused accounts, because zero balance might help your score.
Don't open new accounts that you don't need as a quickie approach to altering your debt-to-credit-limit ratios. That can lower your score.
Don't open several new accounts in a short period, especially if your credit history is less than three years. Adding accounts too rapidly sends
up a red flag that you might not be able to handle your credit responsibly.
Manage Your Credit Wisely
Several credit inquiries during a short period means you are attempting to open multiple new accounts, and that lowers your credit scores.
If you go to different banks to shop for a mortgage may lower your credit scrore. Each lender will pull a credit report
on your application, and this may affect your credit score.
Checking your own credit report does not affect your scores.
Do try to open a few new accounts if you've had credit problems in the past. Pay them on time and don't max out your credit limits.
The Types of Credit You Use
A mixture of credit cards and installment loans, loans with fixed payments, can help raise your score if you manage the credit cards responsibly.
Having many installment loans can lower your scores since payments remain the same until balances are paid in full.
Don't open new accounts just to have several accounts or to attempt a better mix of credit.
Closing an account doesn't remove it from your report. It may still be considered for scoring purposes.
Thinking of buying your first home ? Have you figured out
the maximum amount you can afford ?
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