02/20/2021
We went over the credit do's last week, now lets talk about the credit don'ts!
Check out these 5 tips that you should not do during the loan process
1.) Don't apply for new credit
-Every time you have your credit pulled by a potential creditor or lender, you can lose points from your credit score. This includes co-signing for a loan.
2.) Don't make drastic changes to your outstanding debt
-If you want to pay off your old accounts, do it through escrow. Request a "letter of deletion" from the creditor.
3.) Don't close your credit card accounts
-If you close a credit account, it may appear that your debt ratio has gone up. Closing a card affects other factors in the score, including credit history.
4.) Don't max out or over charge your credit card accounts
-Try to keep your credit card balances 30% below their limit during the loan process. If you pay down balances, do it across the board.
5.) Don't consolidate your debt
-If you are thinking of consolidating all of your debt onto one or two credit cards, consult with your loan officer before doing so.
Still have questions about what you should or shouldn't do to qualify for a home loan? DM me and I'll connect you with a lender that can help you.
Falin Ziadeh
HomeSmart International
602.369.2300
[email protected]
