Tricks in boosting credit scores to qualify for a mortgage

1. How To Improve Credit Scores To Qualify For Mortgage * Borrowers credit payment history and credit scores are one of the most important factors that mortgage lenders take into consideration when qualifying mortgage borrowers. All mortgage loan programs have minimum credit score requirements. FHA and USDA require 580 credit scores. VA does not have a credit score requirement but in order to get an approve/eligible per Automated Underwriting System, a 580 credit score is highly recommended. Conforming Loans require a 620 credit score. NON-QM Jumbo Mortgages require 620 credit scores. Jumbo Lenders and HELOC lenders require a 700 minimum credit score. Borrowers with lower credit scores, Gustan Cho Associates will help and assist them on how to improve credit scores to qualify for mortgage. - Credit scores are what determines whether borrowers qualify for a certain mortgage loan program - For example, to qualify for a 3.5% down payment FHA Home Loan, borrowers need a minimum credit score of 580 - A 580 will limit debt to income ratio cap at 43% - Borrowers with high debt to income ratios need to improve credit scores to 620 credit score - This because the debt to income cap gets increased to 56.9% if credit scores are over 620 - To qualify for a conventional loan, the minimum credit score required is 620 - However, a 620 credit score is considered a super low credit score for conventional mortgage lenders - Borrowers with lower credit scores will get penalized by getting offered a very high-interest rate on conforming loans - To get the best conventional interest rate, borrowers need a credit score of over 740 - Any credit score under 740 will be getting a price adjustment on conventional loans - For FHA loans, credit scores are not as important in getting the best rates - However, any FHA mortgage loan applicant with a credit score of under 640 will get a higher interest rate than those with a 640 credit score or higher - Jumbo mortgage loan applicants need credit scores of 740 to qualify for the 10% down payment jumbo mortgage loan program - Gustan Cho Associates offer non-qm jumbo mortgages for borrowers with credit scores down to 620 2. Re-Establishing Credit After Bankruptcy And Foreclosure * Those with a recent bankruptcy or foreclosure, chances are that credit scores have plummeted. - That is okay - The sudden drop of credit scores will not be permanent - Even nothing is done to re-establish credit after a bankruptcy or foreclosure, credit scores will naturally improve over time - However, those who really want to improve credit and be able to get a mortgage loan as soon as possible need to re-establish credit as soon as humanly possible - The best way on how to improve credit scores to qualify for a mortgage after bankruptcy and/or housing event is by getting three secured credit cards - Most people just assume that due to their bankruptcy or foreclosure that they will only have to deal with cash and re-establishing credit is out of the question - This is not correct - The easiest and fastest way on how to improve credit scores and re-establishing credit after a bankruptcy and/or foreclosure is to get 3 to 5 secured credit cards with at least a $500 credit limit - Use these cards regularly - Never ever miss a payment - Pay all of the credit card minimum monthly payments on time - Even though they are secured credit cards, the credit card provider will report the late payments on the three credit reporting agencies and it will hurt credit scores - Negatively reported items and payment histories from creditors, even secured credit card companies, are on credit report for 7 years Home Buyers with lower credit scores who need to qualify for a mortgage with a direct lender with no mortgage lender overlays on government and conventional loans can contact us at The Gustan Cho Team at 262-716-8151 or text us for faster response. Or email us at [email protected]. We also offer non-QM mortgages for self-employed borrowers. We are available 7 days a week, evenings, weekends, and holidays. ***** follow me ***** Read more https://gustancho.com/how-to-improve-credit-scores