How to get a low mortgage interest rate.

If you hope to get a mortgage, either for a new house or to refinance, the biggest factor will be your credit score. Your credit score will determine how good of a rate you get or whether you get a loan at all.

The credit score isn’t magic; it’s a mathematical formula. It’s important that you know your credit score.

Different reporting agencies may use slightly different percentages, but it boils down to roughly this:

35% Paying Bills On time
30% How Much You Owe and How Much Credit You Have
15% How Long You’ve Had the Accounts
10% No New Accounts
10% Variety of Accounts

Here are a couple of suggestion that might help you.

***Use automated bill payment. Lots of people have the money to pay their bills; they’re just too disorganized to do it. Automated bill payment is usually free, and some banks will even send out paper checks automatically to people you owe who don’t take electronic bill payment.

It’s especially helpful for credit cards, which are now scrounging for every fee they can get. And, most importantly, you won’t get a ding on your credit report for being late.

***Pay down your credit card debt. Lenders don’t want you to use more than 30% of your overall credit limit. Just because someone is willing to lend you money, doesn’t mean you should take it.

They’ll allow you to charge 100% or more because they can add extra fees. For a credit card company, someone who keeps a high balance and barely pays the minimum is the ideal customer; they generate the most fees. But for a mortgage lender, that person is a higher risk.

You also don’t want to concentrate all your balance on one card, no matter what miles or rewards you’re soaking up. Creditors look at your overall available credit and whether you are at your limit in any one account.

At HOPE we help our clients everyday make wise decisions on getting the highest crdeit score they can achieve. If you would like to know more please call us at 704-503-3669. We are waiting on your call.