UNDERSTANDING YOUR CREDIT
For a fee, these agencies will provide you with an online copy of your credit score as well as a credit report — a detailed summary of your credit history, employment history and personal financial information on file. You can also obtain a free copy of your credit report by mail. If you find any errors in your report, notify the credit-reporting agency and the organization responsible for the inaccuracy immediately.
Demonstrating your ability to manage credit is key to maintaining a good credit score. There are a number of things you can do to improve your credit score. These include:
- Always pay your bills in full and on time. If you cannot pay the full amount, try to pay at least the required minimum shown on your monthly statement.
- Pay off your debts (such as loans, credit cards, lines of credit, etc.) as quickly as possible.
- Never go over the limit on your credit cards, and try to keep your balances well below the limits.
- Reduce the number of credit card or loan applications you make.
Once your credit score has improved, work with your mortgage professional to obtain a mortgage that works for you.
- Provides lower rates than open or convertible mortgages.
- Allows you to make an annual prepayment of up to 10-15% of your original mortgage amount.
- Provides flexibility until you are ready to lock into a closed term.
- Allows you to pay off any or all of the mortgage without prepayment costs.
- You can take advantage of the same interest rate for the entire term with a regular payment that stays the same.
- You will have the security of knowing exactly how much your payments are and how much of your mortgage will be paid off at the end of your term.
- Historically, variable rates have been lower than fixed rates and could save you more money.
- If rates go down, a larger portion of your payment goes towards principal, helping you pay off your mortgage faster.Your regular payment stays the same even if rates change.