It isnt hard to secure mortgage loans in Reno, but if you have bad credit, its going to be more difficult for you. What can you do?
Since you missed a mortgage payment on your current loan or on your past mortgage loans, your creditor will take note of that and submit a report about it to credit rating agencies.
Theres something you can do about it but you need to act fast. For a moment, forget about the refinancing that you are trying to secure or your intent of buying a home in Reno. Focus on mending your credit first.
Try these repair strategies.
Prime Lending in Reno - Request for a goodwill adjustment
One of your best options is to ask your creditor for an adjustment. An adjustment can mean striking the late payment out of your credit report.
Send them a letter stating such a request. If your creditor likes to maintain a good relationship with you, they will most likely grant the request. That, on their part, constitutes a gesture of goodwill, hence the name for this repair credit fix.
In the letter you can mention one or more of the following:
A legitimate reason for incurring the late payment
Something you can offer to them in exchange for the goodwill gesture
That you have been paying your bills on time before that month you incurred the late payment
Mortgage Loans in Reno - Do automatic payments
In addition to the first option, you can also do automatic payments (offering something in return to the goodwill gesture). What you do here is you sign up for an automatic payment system, which means your future payments will be automatically deducted from your credit or debit card or any account where automatic withdrawals are possible.
The system is favorable to the lending agency you are transacting with (or even with your current lender). It ensures that payments will be received on time.
Dispute inaccuracies in the report
You may also try checking your credit report first and hunt for any inaccurate data on the item listed as late payment. Once you find an inaccuracy, plan making a dispute on the item. If you will be successful, the item will be erased from your credit history.
Send a letter to each credit bureau that has the item listed in their system. This means you will send a letter to at least three agencies TransUnion, Experian and Equifax.
The law requires that a credit institution send a response to letters of disputes within 30 days, so you will get one from each of these agencies within the said duration.
Avoid incurring more late payments
Since you are already dealing with one late payment and you dont want to be slapped with higher mortgage rates in Reno, make sure to avoid incurring more late payments.
For the first instance alone, your credit score would be slashed by about 100 points. The fact is your good standing cannot be easily recovered. It will take at least 6 months to restore your credit to its former status.
This kind of penalty is applicable on all types of mortgage loans conventional mortgage loans or otherwise. Even people with government-backed loans like FHA loans are not exempted from this punishment.
Mortgage Loans in Reno - Use a cosigner
You may also use the option of using co-signer although this will not automatically erase the bad item in your history. Your cosigner will agree to sign the loan together with and his/her credit will be used together with yours to determine qualification. It goes without saying that you need to choose a cosigner with an exemplary credit.
Once the loan is approved, take it as an opportunity to improve your own score by not failing to be prompt in your payments.
Avoid applying for new loans
For now, you have to forego any intention to obtain other types of loans such as credit cards or car loans. Otherwise your history will get the mark of hard inquiry. What it says is that you are also in the process of applying for other loans. Lending companies will take that as an irresponsible handling of personal loans, which means further derailing of your bid to clean your record.
Mortgage Loans in Reno - Go Legal
The last option is hiring a lawyer, which is the final recourse for many people who are in the process of clearing their late payment. This is usually an effective strategy for those who want to get rid of the bad record in a very quick way. You can use this option, but prepare for the huge expense it will cause you.
Do you have more questions on how to repair your credit or any question on buying a home or refinancing your mortgage? For help with your mortgage refinancing or planning, click here.
Watch the video clip below to learn more:
This hardworking woman is a staunch supporter of social welfare organizations such as the American Warrior Initiative. Visit them online at jillreidhomeloans.com.