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.