Some people have the misfortune of taking out a mortgage when their finances are not great shape, and the repayment rates go off the charts. If you feel that you didn’t get the finest deal out there, you can get a chance to right this misfortune.
Luckily, the interest rates on your loan are not cast in stone, and with a little bit of effort, you can renegotiate the terms. To get the best mortgage refinance rate in Salt Lake City, you must demonstrate a considerable improvement in our credit report.
Luckily, you can do this without pulling out your hair. Here’s how.
Scrutinize your credit report
The credit bureau is not without its shortcomings, and this can spell bad news for you if you fall in the 5 percent of people with errors in their credit reports. Such errors can sentence you to an exceptionally high interest rate since they result in your credit score taking a dip.
You are entitled to three free credit reports annually, and you should take advantage of them. By examining each report, you can pick out any errors and have the bureau rectify them. Doing so can earn you a boost in your credit score, thereby giving you room to negotiate better terms with your lender.
Go easy on the credit cards
The amount of debt you carry on your credit cards has a strong bearing on your credit score. A high debt utilization ratio (over 30 percent) is not good for your credit score. It also tends to make mortgage lenders skittish as carrying too much debt means that you might have difficulties making payments.
Staying below your card limits boosts your score. Also, try to clear much of the credit card with small debts. Doing so will put good debt in your credit history, which is crucial to building your credit score.
Your credit score is a major factor that determines your ability to secure an affordable interest rate on a mortgage loan. Building your credit score affords you a chance to renegotiate better terms on your home loan.
The government offers many benefits to the country’s veterans, including an ideal home mortgage loan.
As banks and other financial institutions continue to tighten their lending standards, the demand for Veteran Affairs mortgages has increased significantly in the past few years. For homebuyers who want to keep their monthly payments low and those who need help with the down payment, a VA loan is one of the ideal mortgage options.
No Down Payment Needed
With loans guaranteed by the VA, you don’t need to put any money down. In addition, this type of mortgage doesn’t require monthly mortgage insurance.
As UtahLoanPros.com explains, “A VA mortgage is one of the few loan programs that allows borrowers to finance 100% of the home’s value and purchase with $0 down. There are certain qualifications you have to meet in order to qualify for a VA loan (typically at a minimum you must be a veteran or an active member of the US armed forces). But, if you do, you can enjoy lower closing costs, lower mortgage payments and the possibility of no down payment.”
It’s easier to qualify for VA loans than conventional mortgages. Those eligible to apply are veterans, most members of the military, active duty personnel, some surviving spouses, and reservists and National Guard members.
To get a VA loan, veterans and active-duty members should have served a minimum of 90 days during wartime. Reserve or National Guard members, on the other hand, must have served at least six years.
Fees and Requirements
VA loans have a one-time funding fee, which can vary depending on the financial situation, type of veteran, and the amount of the down payment. First-time homebuyers, without down payment, have to pay a fee of 2.15 percent. Those who are applying VA loan for the second time, with zero down payment, will pay 3.3 percent of the overall amount of mortgage.
To qualify for a VA loan, it’s important to be familiar with the program’s benefits and requirements. This type of mortgage can make a big difference to the lives of our country’s heroes.