Credit Repair And Mortgage Process And How It Halts Loan Process
This BLOG On Credit Repair And Mortgage Process And How It Halts Loan Process Was UPDATED And PUBLISHED On November 23rd, 2019
There are several things to keep in mind with Credit Repair And Mortgage Process. Many people want to know the fastest way to repair credit and improve credit score to qualify for a mortgage. Home Buyers need to consider the dangers of the Credit Repair And Mortgage Process.
- Repairing credit and improving credit scores can be done but it takes time.
- Getting bad credit can be done literally overnight
- However, to repair credit and improve credit score is like making a New Year’s resolution
- Consumers need to make a commitment to repair credit and improve credit score and need to be consistent and not get discouraged because it does take time and effort
- It is like going on a diet
- There are struggles not to eat favorite foods and see little to no results and eventually give up
In this article, we will cover and discuss how credit repair can backfire during the mortgage process.
Do Credit Repair Companies Work?
There are thousands of credit repair companies throughout the United States.
- The problem I run into is finding a reputable credit repair company
- I am sure there are hundreds of credit repair companies who are reputable and I am always in a search for them
- I have worked with a few credit repair companies that are absolutely outstanding and reputable before
- Unfortunately, the credit repair companies that I have worked with before either sold their business or the owners have changed careers
Credit Repair Does Work
A credit repair company’s main objective is to repair credit and improve credit scores.
- They use loopholes in the credit rules and regulations to get negative items off credit reports
- I have seen bankruptcies, foreclosures, judgments, and tax liens get deleted off credit reports
- However, just because the items are deleted does not mean that the bankruptcy, foreclosure, judgment, and tax liens are off credit record
- Borrowers who are applying for a mortgage loan or any other loan and are asked a question concerning whether or not they had a previous bankruptcy, foreclosure, judgment or tax liens
- Borrowers must tell the truth
- In the event, if a mortgage applicant has judgment and state they do not have a judgment on a mortgage application because it is not on credit report, they are committing
- Deleting those derogatory information works only with collections, late payments, and charge off accounts.
- All lenders do a third party national public records search so deleting judgments, bankruptcies, foreclosures, short sales will not work because it will get discovered with a public records search
Why Repair Credit And Improve Credit Score
Consumers who intend on purchasing a home or an automobile in the near future, they will need a fairly clean credit report and somewhat of a decent credit score to qualify.
- The cleaner the credit report and higher credit scores are, the better the chances to get a mortgage approval or loan approval
- The cleaner credit report and higher credit scores are, the better the interest rate will be
Credit Repair And Mortgage Process And Tips On How To Improve Credit Score
We will be discussing more on how to repair credit and improve credit scores in future blogs.
- The first step consumers need to take is to monitor credit report regularly and make sure there are no errors on credit reports
- There are three credit reporting agencies; Transunion, Experian, and Equifax
- Check for any errors on credit report
- Need to write a dispute letter to each of the three credit reporting agencies
- Each of the three credit reporting agencies has 30 days from receiving a letter to respond to credit dispute
- The credit reporting agency contacts the creditor who is reporting you
- That creditor needs to confirm that the debt they are reporting is valid
- If the creditor does not respond to the credit reporting agency within the 30 days, the credit reporting agency needs to delete the disputed item
- Or they are in violation of the Federal Credit Reporting Act (FCRA)