Do You Know These Eight Things?

What you must know to get approved for a home loan:

• 1. Do you fully understand the new credit scoring system? The first thing a Lender does is to classify your credit. This is based on your numeric credit score. You need to know how the numbers are calculated and how to get a higher number if you want to get a cheaper loan.
• 2. Do you know how to remove damaging information from a credit report quickly and legally? It is your right under the Fair Credit Reporting Act to get false information off your report. Many people have old delinquencies that were taken care of long ago, still showing on their report.
• 3. Do you know the best way to handle emergency and unfortunate situations? Things happen which are out of our control--illness, accidents, divorce, etc. However, if you handle your credit and finances in the best possible way, you can protect rather than demolish your credit. This you do have control over. Are you confident you know how to handle this in the very best way?
• 4. Do you know the employment/income rules? Many people who don't think they have enough money to get a home loan actually do. One woman was waiting years unnecessarily because she didn't know she could buy a house when she was on social security income. Meanwhile, the prices of houses kept going up and up. Another instance is that you need to know how to present your employment in the way that is acceptable to the Lenders. If you have had several job changes or self-employed income, this is especially important. The difference between saying the right thing and the wrong thing is the different between getting approved and denied. Do it right the first time and save yourself time and frustration.
• 5. Do you understand Compensating Factors? If you have some pretty poor credit to overcome in order to buy a home, the best trick to know is Compensating Factors. In other words, make up for it in some other way. Lenders will allow and will accept this. It is definitely worth taking the time to learn about the rules of Compensating Factors.
• 6. Do you know the down payment requirements? This is basic. Everyone needs to know this.
• 7. Do you know about special loan programs? Wow, this is a big one! There are special loan programs designed specifically for people who do not have good credit. If you are applying for the loans for people with good credit and with the companies who lend only to people with good credit, it is no wonder that you are being denied. People with imperfect credit are in the majority of the population, and they absolutely must become informed about the special loan programs designed for them.
• 8. Can you make an excellent presentation? If you tell a loan officer why your credit was bad in the past, and you tell it in a way that the underwriting department (approval department) does not like, you will get laughed at and denied. They may not laugh in your face, but they do laugh right out loud, and then your loan officer calls you and tells you sweetly and kindly that she is so sorry but you are not approved at this time. It is all in the presentation you make! Present your situation is a different light and receive an approval! You need to learn how to do this, and that is the truth.