Texas Lending (TexasLending.com) regularly speaks with clients who have been denied loans due to a poor credit rating and acknowledges that this can be frustrating. There are a few things customers can do to improve credit and, over time, begin to qualify for a home loan. Texas Lending recommends a few tips to begin to turn a credit rating around:
Step One: Pull Your Credit Report
One free credit report per year is available from each of the major credit bureaus. Texas Lending routes customers to annualcreditreport.com, but points out that these reports don’t include your FICO scores. Texas Lending can connect you with the report you’ll need to get a thorough look at your credit.
Once you’ve obtained your credit report, Texas Lending recommends reviewing it for errors. Any errors can be disputed in writing with the credit bureaus and the company that erroneously reported the information.
Step Two: Pay Bills on Time
The team at Texas Lending has a few tips for making sure your bills are paid on time. If you haven’t yet set up auto-pay, Texas Lending advises doing so immediately. This can be done through the debtor. If you choose to continue to manage bills yourself, set up text notifications or automatic reminders to pay certain bills. Paying your bills on time is key to repairing your credit.
Step Three: Reduce Your Debt
One of the best things you can do to begin to take control of your finances is to reduce your debt. Texas Lending advises clients to put credit cards away and stop buying things they can’t afford. Determine which credit cards charge the highest amount of interest and pay those credit cards first. As you pay off each card, you’ll notice your minimum monthly payments dwindling, allowing you to put more toward paying off the other cards.
As you begin to pay your bills on time regularly, Texas Lending says your FICO score will almost immediately begin to improve. Texas Lending cautions it’s imperative that you pay your bills on time. Even a few late days can have a negative impact on your score, Texas Lending warns.
If a payment has gone to collections, simply paying it off won’t remove it from your credit report. As Texas Lending tells clients, collection accounts remain on a person’s credit report for seven years.
For those who have fallen into financial hardship, Texas Lending recommends seeking the assistance of a credit counselor. While this won’t necessarily improve your FICO score immediately, a licensed credit counselor can work with debtors to make sure a payment plan is arranged that you can manage. Over time, paying these creditors on time can begin to improve your credit situation.
Texas Lending has been a trusted lender in the Dallas/Fort Worth area for more than a decade. Fully able to help borrowers with all mortgage needs, Texas Lending is expanding its services to help homeowners in Oklahoma, Florida, Kansas, and other states.
For more information, visit Texas Lending online at www.TexasLending.com