| Why Credit Repair is Important |
| Articles - Mortgage |
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Most people underestimate the power of a good or bad credit score. It can have implications on everything from insurance rates to buying a home. Here's an example of how your credit scores can affect you that just happened to a client of mine. Two months ago this person decided to buy a home with pre-approval from their lender. Two weeks ago they found the perfect home and we wrote an offer on it that was accepted. During the underwriting process, my client's score dropped 3 points. They lost their dream home.
Most people underestimate the power of a good or bad credit score. It can have implications on everything from insurance rates to buying a home. Here's an example of how your credit scores can affect you that just happened to a client of mine. Two months ago this person decided to buy a home with pre-approval from their lender. Two weeks ago they found the perfect home and we wrote an offer on it that was accepted. During the underwriting process, my client's score dropped 3 points. They lost their dream home. Credit score is being used more and more these days. Everything from car insurance, employment, promotions, and loans of any size and shape. Your credit score may turn out to be one of the most important numbers that you will have. For better or worse, that the credit reporting companies will have great power over your life. Like it or not, YOU HAVE TO BE PROACTIVE! Know how to manipulate your score to improve it. Don't expect much help from the credit reporting agencies because every time somebody pulls your report they get paid. When you shop around for a better deal on that car or home, they make money. The lower the score, the more money the credit reporting agencies make. I recommend you use a professional credit repair company to work with. Please note that I do not do credit repair. That being said there are some rules that I have learned about that will help you along the way: 1. Get professional help. Remember, if you want to get the highest score possible in the shortest amount of time, get some help, from a pro who is experienced in credit repair. 2. Make your mortgage payments on time. What causes your credit score to be hit the hardest the fastest? If you are late on just one house payment your score drops 100 points! That's right, and if you have ever tried to bring it up it will only go up a few points at a time and over time. 3. Check your credit score every year. Every person can and should get a free report form each of the credit reporting agencies every year to see what is being reported and if that information is correct. You might be surprised at what you find. 4. Pay all medical expenses promptly. The other things that will hit your score very hard are medical collections. These collections can pound your score worse then an Iron Chef smashing a piece of meat with one of those metal hammers with little spikes. Get these paid off ASAP or set up a payment plan. Some hospitals will settle for this than what is owed. It never hurts to ask. Credit repair is a process. Check back for more tips and articles to help improve your credit score. DISCLAIMER: This article is provided as information only and is not to be taken as financial advice. Todd Koch is a real estate agent and investor in Southeastern Michigan who sees the implications of credit scores and the importance of improving credit scores on a daily basis. |