Check Out Your Credit BEFORE You Apply for the Loan

OK, it's like this... Would you rather walk around in a dark room or turn on the light so you can at least see where you're going? Unless you regularly check your credit report, you probably have no idea what your credit is actually like. Even if you check it annually, one year is still a long time and on top of that, most people only run their report when they are applying for a loan. Do you ever see that report?

My point is that you should know where you're headed. Every time some one pulls your credit report, that counts as a credit inquiry. If you have too many credit inquiries, that lowers your FICO score which is so important in qualifying for a loan (unless you plan on paying for your property in cash). That credit report also has a shelf life and could be pulled twice as part of the loan portion of the escrow process - once at the beginning to pre-qualify you for the loan and once at the end to ensure everything is still current.

Get a free credit report at none other than http://www.freecreditreport.com/. There are other websites that offer free credit reports as well. You will need to obtain a report that has your FICO score listed. Credit bureaus (Experian, Equifax, Trans Union) also offer one free report annually for consumers, but the last time I checked, the FICO score was not included. Things may have changed.

Review the report for any errors and correct them if needed. In some situations, this may take months! Give yourself the time you need to prepare for your loan without impacting your credit score. Talk to lenders and find out what kinds of FICO scores are necessary for the loans they are advertising. Know where you stand before you apply for the loan. You'll feel much more confident about the loan process if you know where you're headed!

Happy loan hunting!

***Your realtor may also be able to help you estimate a ball park figure of the amount of loan you may be able to qualify for.

Coreen K. Nishijo (RA)
The Master's Plan Realty, LLC
ckn0316@hawaiiantel.net
Office: (808) 488-2992