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Credit Matters When Buying San Diego Homes
How to Improve and Maintain A Healthy Credit Report
Remember: Check your credit report as soon as you begin shopping for San Diego homes for sale
Before you even start shopping for San Diego houses for sale, get a head start at cleaning up your credit report. Even if you’re sure you have excellent credit, it’s wise to double-check by ordering a credit report at the outset. Eliminating errors or disputed items in advance will give you access to better mortgage interest rates and avoid troublesome holdups that may otherwise arise unexpectedly while your loan application is being processed. The better your credit, the better your options when buying San Diego homes.
Your credit report may include disputed items. Mistakes caused by a faulty social security number or similar name are common. Sometimes liens or court- ordered judgments that have actually been paid off have not yet been cleared from the public records. A simple letter to the appropriate credit bureau is often all that is needed to clear your credit report, and credit bureaus are required to help you straighten things out in a reasonable time (usually 30 days).
Key Suggestions:
Make sure that any outdated derogatory entries are deleted from your credit file. Adverse credit information should be removed from your credit report after seven years. San Diego foreclosures will stay on your credit report for seven years, and short sales typically only two to three years. Bankruptcy information may be reported for up to ten years).
Officially cancel inactive credit cards. Some mortgage lenders consider inactive credit cards to be potential future debt. An excess of inactive credit cards with significant credit limits could prevent you from obtaining a mortgage loan. Don’t just cut up your extra cards. Officially cancel them, and do it in sufficient time for the news to reach the credit bureaus!
Hold off on making any major credit card or car purchases. Monthly payments on credit card balances will be counted against you, and reduce the size of the available mortgage. Buying a new car or an expensive flat-screen TV on credit just prior to a house purchase is one of the most common mistakes that we’ve seen San Diego home buyers make over the years. A spending spree for appliances, furniture or other goodies intended for your new home may ruin your chances of buying it.
Even pre-approved mortgages are subject to last-minute evaluation of your financial standing. So don’t expect that an earlier loan pre-approval will guarantee your ability to buy that perfect house or condo in the future. Credit is dynamic. You need to stay aware and be conscious of your credit report at all times.
This Free Report is brought to you by the San Diego Real Estate professionals, The Schiering Team at Keller William Realty.
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Free Home Buyer Resources:
- The San Diego Home Buying Process
- How a San Diego Real Estate Consultant Will Save You Money.
- The First Steps to Purchasing a Home
- What Did The Mortgage Lender Just Do To Me?
- Tips for Financing or Refinancing San Diego Homes
