Your Credit Score, and How it Affects Home Buying

January is often the time of financial reflection. The holidays are over the joy of giving has been replaced by the reality of dealing with all the credit card bills. When reviewing which bill payments take priority, remember to keep your credit score in mind, as home buyers who are seeking a mortgage find out early how important their credit score is in the home buying process and in determining the interest rate that a lender offers.

WHAT IS A CREDIT SCORE?

A credit score is a number that lenders use to estimate risk.  Experience has shown them that borrowers with higher credit scores are less likely to default on a loan. Credit scores are generated by plugging the data from your credit report into analytical software. Credit reporting agencies don’t necessarily use the same scoring software, so don’t be surprised if you discover that the credit scores they generate for you are different.

Credit scoring software only considers items on your credit report. Lenders also look at other factors that aren’t included in the report, such as income, employment history and the type of credit you are seeking.

Borrowers with good credit scores are typically offered more financing options and belter interest rates, but don’t be discouraged if your scores are lower, because there’s a mortgage product for nearly everyone. Please call me with your questions on the types of financing available for your particular financial situation.

The pie chart shown here shows a breakdown of the approximate value that each aspect of your credit report adds to a credit score calculation. 

Dave Cooke is a Calgary mortgage broker. For more information contact him at 403-836-1201 or visit

  his website

I love what I do - I change people's lives

Recently a co-worker said that she loved what we do - changing people's lives. I felt the same.
   When you get a mortgage approval for a first time home buyer, their lives are changed forever. It's a great feeling. However, sometimes mortgage brokers are called on to help people out of a bind.

 January is the start of the new year and a challenge to many people. When the credit card bills come in after Christmas, there can be a sudden financial strain on the family budget.
     With all the layoffs we have had in Alberta over the past 2 years, some people are having a tough time paying their bills and their mortgage.
    This is when I don my blue cape and become a super -hero.
    There are a number of ways that a mortgage broker can help home owners:
1- we can set up a line of credit using the equity in their home to pay off high interest credit cards and get the family back on track.

2- we can set up a second mortgage to pay off the bills and perhaps a car loan as well.

3- refinancing the mortgage to either pay off bills or to just lower monthly payments is another option.

4- re-negotiating the mortgage to skip a payment or  extend the amortization to lower monthly payments or lowering the payments for a few months can also be a consideration.

    As you can see there are a number of possible solutions to money problems if you contact your mortgage broker before you get into foreclosure or have bill collectors calling.
 
   Let your mortgage broker be your super hero , it's all part of the job of changing people's lives.
For more information or help on picking the best option for you contact me : http://davidcooke.ca
or call me 403-836-1201