Here are some great tips that could simplify one of the trickier issues many people struggle with when getting a new mortgage. It has to do with getting your loan approved quickly and the role your credit history plays.

There are four main factors that an underwriter (the person who reviews loans and makes approval decisions) considers when reviewing a loan applicant’s file for approval.

IN) Collateral – (value and quality of the object dwelling).

B) Equity – (the source of the down payment funds).
1. Probability that the applicant will allow this money to be lost.
(Borrowed Funds = High Savings = Low)

VS) Ability To Repay the Loan (income and credit obligations).

D) willpower To Repay the Loan (credit rating).

I’m going to focus on the credit rating. This topic raises many questions. However, if you understand a few things about your credit report, it can save you time and effort.

Every home loan application must be accompanied by a credit report. This report will be generated right after you have applied for a loan. This report is an important part of the application file. It helps the lender determine the relative risk it may be incurring in making the proposed loan.

Every loan applicant now receives a score with their credit report. It is more commonly called a “FICO” score. Many lenders emphasize this score as the best indicator of an applicant’s credit rating. The company that helped develop the scoring system is called Fair, Isaac & Co. According to Fair, Isaac & Co., the types of information used to develop the score are:

– Payment history
· Public records and collection accounts.
· Seriousness, actuality and frequency of delinquencies.

– Pending debt
Number of recently reported balances.
Average balance in all commercial lines.
Relationship between total balances and credit limits.

– Credit history
Age of the oldest credit account.
Number of new credit accounts.

– Search for New Credit
· Number of inquiries and openings of new accounts in the last year.
· Amount of time since the last credit inquiry.

– Types of Credit in Use
Bank cards, trips, department stores, installment loans…

All credit report information originates from the credit grantor and is sent to three major credit repositories. All information can remain on your credit report for up to seven years. Providing proof of any errors can help with the loan in question, but items that need to be permanently disputed or corrected has to Get hold of these three companies, or they will continue to show up on future credit reports. These three are the fountain of all information in the credit report. They are:

equifax
Experian
trans union

There are some great companies doing business today in the field of credit repair. By legally disputing items on one’s credit report, some of these companies have had great success removing negative marks from reports.