Credit and home-ownership
If you’re thinking about buying a home, you should also be thinking about your credit. The first step in the home-buying process is understanding your credit.
When you apply for a mortgage, lenders will review your credit report. Your credit report is a history of how you’ve managed your finances: it’s a record of money you’ve borrowed and your history of paying it back.
Your credit report is a record of all your credit transactions whenever and wherever you’ve used credit to purchase goods and services. Your credit will have a big influence on whether or not you can get a mortgage, the terms of that loan, and the interest rate. If you have good credit, you may have a much wider range of mortgage offers with lower rates.
So how do you better understand credit?
- Be aware of how important your credit history is to the process. Establish a good credit record and protect it.
- Look at your credit report and credit scores.
- Make sure you correct any mistakes on your credit report right away.
Key elements which you need to be aware of and in control of with regards to your credit ratings are:
- Credit reports and history
- Credit scores
- Establishing your credit