In today's lending environment most Lenders want to qualify a mortgage loan with credit scores in the 640 to 680 range. So you are two points off of the "standard." There are programs that allow for scores lower. Here at my company we allow for scores down to 620, but the Underwriting criteria becomes stricter. That's why you want to be careful when Lenders answer your question by saying, "I can do that score no problem!" Because there WILL be a problem, and maybe a denial of your loan application after much heartache.
Here are some general principles for you about credit and then two links to the best sites for credit advice.
1. It can happen in 30 days, or 90 days or more depending on your overall credit, but you can get the two point boost in your scores if you simply lower the balances on your credit cards to just a little less than 50% of the available credit. So, if your limit with your VISA card is $3000.00 and you currently owe $1850.00, by paying the card down in one shot to, say, $1375, you'll likely get a boost of a few points. And you only need a few points.
While an action like this is no guarantee of success---there are many factors that go into a credit score---I have seen clients take this action and it works.
2. Your Mortgage Banker should be able to provide you with the results of a "Rapid Rescore" scenario wherein she advises you which, if any, actions you can take will improve your scores. If the loan officer you're working with didn't suggest that, I suggest you find a new loan officer to work with.
3. Recent activity on your credit report---whether on good accounts or bad accounts (collection, chargeoff, etc.) has immediate impact on your credit scores. So, if you recently paid off a collection account, that could be impacting your credit score negatively. Over time the score will improve as the collection account "ages out."
4. Number of trades: yes, this has an impact both on your credit score, but also, in this day and age, on your ability to be approved for a mortgage loan even with a good score. Typically we Lenders want to see a consumer has at least 2 to 3 accounts open and active for 12 months or longer.
I hope that helps you understand the rather complicated credit scoring system and underwriting requirements.
Here are the links I promised you:
I have found that CONSUMER ACTION is an excellent resource for objective advice on all things credit related. You'll find free and sincere advice on everything from settling collection accounts to rebuilding credit to building credit from scratch on their website. http://www.consumer-action.org/
Beware of anyone offering to "repair" your credit! The Federal Trade Commission issued a stern warning last year that such offers are scams. Find more from the FTC HERE. http://www.consumer.ftc.gov/articles/0058-credit-repair-how-
PowerHouse Solutions, Inc.
185 Great Neck Rd, Suite 240
Great Neck NY 11021
Licensed Mortgage Banker â€“ NYS Dept. of Financial Services
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There are a lot of variable in getting a mortgage these day.. On credit alone you can qualify, but there are a lot of other factors to consider! Contact me to refer you to one of the best brokers in our area, that will be able to help you! best of luck!