Credit Cards, Credit Scores, and Home Equity Rates Are Connected
Read this tip to make your life smarter, better, faster and wiser. LifeTips is the place to go when you need to know about Home Equity Loan Tips and other Mortgages topics.
Do my credit cards affect the home equity rates I am offered?
How you utilize your credit cards will tell your potential home equity lender a lot about you. In fact, it will greatly impact the home equity rates offered to you. Many consumers don't realize the two simple steps they can take with their credit cards to help get them better home equity rates. These two steps are:
- Step 1: Pay down your credit card balances: The
closer your credit card balances are to the limit of your cards, the
worse your credit score will be. Try to make some bulk payments to your
credit cards about 60 days before you plan to apply for a loan.
- Step 2: Beg forgiveness on late payments: If
you're 60 days late on a bill, the lender will often report it to the
credit reporting agencies. This can have a major impact on your credit
score. If you're not often late, your lender might agree to remove the
late reporting once you bring your account current--they might even agree to remove the late fees, which will lower your balance and save you money. Give them a call
at least 60 days before you begin to compare home equity rates and find out if they're willing to do that for you.
Nobody has commented on this tip yet. Be the first.