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If you want to buy a house, chances are good you are going to need a home mortgage loan. In the past, excellent credit meant the best home loan rates. Today’s economic environment demands sparkling clean credit to even be considered for a home mortgage loan.
When you begin to apply for a home mortgage loan, don’t walk blindly into your lender’s office. Know what your credit score is, what each of the three main credit reports say about you, and be prepared to explain the reasons for problem areas. Home mortgage loan bankers are people just like you and want to give you what you dream of. However, they are also in a business that is only successful if the loans are paid back.
More serious credit issues will completely bar you from getting a loan, but if the problems are short-term payment problems evidenced by a few late payment entries, and you have a legitimate reason for falling behind, prepare a written statement that can be included with the loan application to explain it. That can help your chances of obtaining a home mortgage loan, and getting the best home loan rates. It only works if your current credit situation shows that you have resolved issues and are current and in good standing with creditors.