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Credit & Getting a Mortgage Loan


Credit reports are maintained by three companies: Equifax, Experian, and TransUnion.

It’s no surprise that your credit will play a prominent role when you are getting a mortgage loan. Here is some valuable information on your credit and how it interfaces with your mortgage loan.

Your Credit Score & Report

Your credit report is an important part of getting a mortgage loan. Credit reports are maintained by three companies: Equifax, Experian, and TransUnion. Your report contains information on your credit payment history. The information the credit bureaus compile in your report includes your current and previous addresses, the types of debt you have, how much debt you have, who your lenders are, your payment history, how often inquiries are made about your credit, and any history of bankruptcy or judgments. This information is then used to compute your credit score, which can range from 300-850. When getting a mortgage loan, you will be privy to the best rates and terms if your score is 700 or above. Scores below 620 are generally considered subprime when getting a mortgage loan, and you will then be charged higher interest rates.

Before getting a mortgage loan, it is a good idea to review your credit report.

Checking Your Credit for Free

Before getting a mortgage loan, it is a good idea to review your credit report. By law, you are entitled to one free credit report per year from each of the credit bureaus. Review your reports carefully for any mistakes. The Fair Credit Reporting Act enables you to dispute any inaccurate information contained in your report, and the credit bureaus must remove the information if they cannot verify it as accurate within 30 days. Identify and dispute any mistakes before getting a mortgage loan to maximize your chances of qualifying for a competitive rate. You will need to dispute the item in writing with the credit bureau before getting a mortgage loan. The bureau then has 30 days to investigate the report and issue a decision.

The Fair Credit Reporting Act enables you to dispute any inaccurate information contained in your report, and the credit bureaus must remove the information if they cannot verify it as accurate within 30 days.
Learn how a mortgage works. Mortgage and credit and how it works.