4 Steps to Finding the Perfect Loan
4 steps to obtaining the perfect loan at the perfect rate. Bad credit is not a problem, find out what you can do to get a loan that meets your financial needs!
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| 4 Steps to Finding the Perfect Loan |
By:
Emily Murray |
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Finding a loan thats right for you isn't always easy. The following 4 steps should help you find your way through this often-stressful time and make your life a little bit easier at loan time.
STEP 1
OBTAINING YOUR CREDIT REPORT
The 1st thing you want to do is run your credit. This is the most important step so PLEASE do yourself a favor and dont skip it! This step is the most important because your credit has a great impact on the terms and percentage rate of your loan. Of course that does not mean you cant get a loan if you have bad credit. There are many bad credit loans available today but in order to reduce your monthly payment and % on a bad credit loan (or any other loan) you must know what is on your credit report to be able to fix it, the point is not necessarily to get your credit to a perfect standing, that takes a long time, what your trying to do is improve it as much as possible before your home purchase so that you can find a loan or bad credit loan that will work for you without it being a financial nightmare.
Also, by managing what is on your credit report you can improve your credit score a.k.a your Fico Score. This Number is the key element in determining the loans you will be eligible for and the terms within the loan. Higher FICO Scores = Lower Monthly Payments.
This process needs to be put into action ASAP because it does take time. Often, there will be items on your credit report that do not belong to you, etc. These can be disputed and it takes about a month to update. I would see what you can do on your own first to fix it up but if it is to much of a mess to clean up on your own there are companies who can help you fix your credit and even remove some of the items. This also takes a lot of the stress off of you.
Even if your credit is not an issue it is a good idea to run your credit and get your score. Knowing these can give you leverage during the loan negotiating process by allowing you to only accept the best offers that are reflective of your credit score.
Okay, now there are a few ways in which you can obtain your credit report.
First, you are entitled to one free credit report a year! It is very easy so please take advantage of this! You can you obtain it at annualcreditreport.com. Please note there are companies that offer free credit reports if you sign up for a trial offer of a product. This is not the same thing at all. You do not sign up for anything, its your for the taking-FREE!!!!
Second, you can purchase a credit report through each individual credit bureau: Experian, Equifax and Transunion. You can view it over the Internet or have it mailed to you. These sites sell their single report for a reasonable rate and you can add on your credit score for an additional fee.
Third, there are many other companies that can obtain your Fico Scores/Reports for a reasonable price. Just google credit reports and youll find hundreds. If you choose this route make sure you read the fine print.
STEP 2
LOWER YOUR DEBT
The 2nd step is to lower your debt. You want to try and bring your debt down as much as possible before owning a home. Another factor lenders look at besides your credit score is your debt to ratio income (how much money you make vs. how much money you owe). When your debt to ratio income is good your % decreases. So basically if you pay down your debt you win two ways because paying down your debt will also improve your credit score. So, if you get a better % you get a lower monthly payment and maybe even a better loan and then getting the loan wont be so financially stressful. I think an even more important reason to pay down your debt is so that you are not bogged down with bills AND a new mortgage. Why own a home if your always going to be at work trying to make ends me? I know it makes sense but is often easier said than done. There are many great companies out there who specialize in debt consolidation and can help with this step!
STEP 3
KNOW WHAT YOU CAN AFFORD
The 3rd step is as easy as a few clicks. A mortgage calculator can help you figure out what you can afford. Use an internet based mortgage calculator to find the right loan price for you. You can find one at www.casagrandenewhomes.info/Loan.html. Its free and very helpful. This will give you a heads up and maybe even make you re-think your price range +/-. Going in knowing what you can afford will also cut out the back and forth between you and a lender because you will know up front a price range that is financially acceptable for you. Also go in with a set price range and dont exceed it unless you CAN afford it.
STEP 4
SHOP AROUND
Your 4th and final step is to find and choose the lender with that perfect loan. Do not let a whole bunch of lenders run your credit. Especially when you just went through all the trouble to improve it. Your looking for the loan that is just right for you, look for specials or ad's that pertain to you. Do your homework on your top 5 and then from there choose 2 or 3 to work with. Have them competing over you. Remember you want to get the best deal, youve worked hard you deserve it. Now go and get Ëœum!!!!!
GOOD LUCK!!!!!!
For further information and a full copy of this article please visit http://www.casagrandenewhomes.info. For further information on how to fix your credit, lower your debt, obtain your credit score, and find great lenders please visit: http://www.casagrandenewhomes.info/Loan.html
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