A low interest bank equity home loan mortgage requires a good or excellent credit score. Homeowners or first-time home buyers with a history of adverse credit can still strive towards a better credit score for the lowest mortgage rate, but they’ll need more equity or a larger house deposit. Although all credit transgressions will continue to show on a credit report for a period of 7 years (10 years in the case of chapter 7 bankruptcy), there are repair methods that can be used to achieve a higher credit score.
Too Many Applications for a Bank Equity Home Loan Mortgage
One of the more common mistakes homeowners make is applying for the best fixed rate mortgages without making sure that they meet the eligibility criteria. Each credit search will be seen by potential creditors for a period of 12-months. Too many searches could lead to rejection because potential lenders associate this with financial struggles and eventual default. Homeowners are advised to use a professional mortgage broker or a comparison site, such as moneysupermarket.com, to pinpoint low rate mortgages.
Correct Credit Report Errors for the Best Fixed Rate Mortgages
The first step towards getting the lowest bank equity home loan mortgage is making sure that the information held by credit reference agencies – Experian, Equifax and TransUnion – is completely accurate. Consumers are legally entitled to a free copy of their credit report each year by telephoning (877) 322 8228 or from annualcreditreport.com. Should a copy have already been requested, they are available for about $9 each. Each report will also provide guidelines regarding how to dispute erroneous information. Bad data can be disputed either personally or with the help of a credit repair attorney.
An Improved Credit Rating for a Bank Equity Home Loan Mortgage
- Avoid using more than 30% of the available credit limit on a card each month. Up to 30% of a FICO score is made up of the amount of money owed to creditors. Pay back debt in-full and on-time each month for a better credit score.
- Don’t perform a balance transfer from a high to a low limit credit card because it gives the impression that a greater percentage of that person’s total credit has been used up.
- For the exact same reason, don’t close down old credit and store cards. Instead of allowing them to gather dust, make a purchases on the card each month.
- Use personal savings to reduce debt before applying for a low rate mortgage.
How to Get the Lowest Mortgage Rate
The best bank equity home loan mortgages will only be offered to customers who are least likely to default on the agreement. Although the lowest rates won’t be offered to everyone, investing a little time to get a better credit score can and will save money. An improved credit rating, especially when combined with a higher house deposit and a stable job, leads to a reduction in monthly mortgage payments. Always apply selectively for low APR mortgage loans as it is imperative that the eligibility criteria are complied with.