If you are thinking about applying for a home loan, you might want to first make sure that you are preparing for the process. This way, you will have given yourself the best possible chance at successfully being approved for the loan. Check out the following tips to help get you started.
Dispute Old Or Invalid Debts
While there are certain things that are simply not able to be successfully disputed, you might be able to clean up your credit report by disputing old debts that have either been paid and not removed from your credit or that you have no idea where it came from. When you dispute something on your credit, the creditor only has a limited amount of time to prove to the credit agencies that the debt is still valid. If they cannot do this or simply fail to do it within the allotted amount of time, the negative marks must be removed from your credit report. Whether you are able to remove several things or just one thing from your credit reports, it should have a positive impact on your credit score.
Save As Much As You Can
Even if your goal is to get a home loan with zero money down, you just never know when you might need a little extra money for closing costs. The more money you have, the easier it might be to become approved for the loan. One thing to remember is that not many lenders like your down payment money to be money you borrowed from a relative. Therefore, if you must, borrow money to help pay your monthly bills and start banking money from your paychecks, bonuses, and income tax returns. You might even want to take on a small second job in order to help add funds to your down payment and closing cost savings.
Do Not Take Out Any More Lines Of Credit
Even if you have already been pre-approved for a home loan, you need to make sure that you are carefully moving forward with all things debt related. Sure, you can pay down your debts, but never add more to the pile. The reason for this is that any lenders will pull your credit again right before the closing for the home and deny you if you increased your debt to income ratio by even the smallest amount.
As you can see, a lot of these things are things that are completely within your control. Make use of these tips and you should have no problem increasing your chances of getting that home loan.