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How To Improve My Credit Rating Fast

This client has done everything right in terms of paying his bills on time and avoiding debt, but has far too many credit cards which makes him a perceived credit risk in the eyes of most lenders. He has a good job and makes sufficient money for the mortgage he has applied for; however is being turned down due to too many credit cards. He wants to know how to improve his credit rating fast so that he can be approved for a mortgage.

This situation of too many credit cards and a bad credit rating affects thousands of consumers every year. Many large department stores and companies offer credit cards with large discounts and incentives to consumers when they are making purchases. The credit cards usually carry very high interest rates on unpaid balances, although they do offer significant discounts to consumers for initial purchases. It is very easy to end up with many credit cards which can affect their credit rating.

The first thing this client should do is call each of the credit card companies and begin closing these cards. He may decide to keep one or two cards which is fine.  The problem will be that it could take six months to a year before his credit rating and report reflect closing these credit accounts. This delay will not help him in being approved for a mortgage any time soon. He should also obtain statements from each company showing that his accounts have been closed and any balance fully paid.

In the mean time we suggest that the client work with a mortgage broker to obtain a mortgage lender who will be willing to take them on as a client even with their bad credit rating.

DEFAULT LOAN APPLICATION FOR BORROWER’S INFORMATION

Home/Mortgage Loan Amount :: $200,000

Home Loan Application and Processing Speed (when do you need the funds)::I need an answer quickly about my mortgage application and whether it can be approved or not. I have applied to a number of locations and been turned down, so can you let me know in the next 24 hours?

Do you currently have a mortgage? :: no, we currently rent and would like to buy a home.

Bank Name and Branch :: Wells Fargo Bank, State and Columbia

What City/Town, State and County do you live in? ::San Diego, California

Zip :: 92101

What is your employment field? :: Manager for an Insurance Firm

Employment Position ::Manager

When are you paid? (monthly/weekly/biweekly)::Bi weekly

Your credit rating to be – excellent, fair, or bad? :: I recently found out that my credit rating is bad due to my credit cards

How did you find us? :: searching for mortgages online and wondering how I can improve my credit rating

How are you paid? (direct deposit/paper check):: direct deposit

Gross Amount Per Paycheck ::$2400

Do you agree to have this information published online, without your PRIVATE information of course? ::Sure, just do not display any personal information such as my name, address or bank information

Extra information here please (some detail):: I have been applying for a mortgage all over the place. We have gone to our local bank, to banks that we do not deal with and we have applied online as well for a mortgage. They have all turned us down due to my bad credit rating which came as a complete surprise to my wife and I.

We live in an apartment and want to get a house of our own and have an offer on a home, but cannot get a mortgage. I really need to improve my credit rating fast so that we can be approved for this mortgage.  As we mentioned this is the first time we even realized that we had a bad credit rating, since we have never missed a payment on anything and never have had a problem with any loan repayment or debt issue. So how could we have a bad credit rating?

All that the lenders will tell us is that our rating is too low to be considered for a mortgage.

Note to Lender :: We both have good jobs and we both are reasonably secure in those jobs. We make more than enough money based on lenders calculations to carry the monthly mortgage payment and the taxes. We just cannot understand what the problem is.

One lender we talked to gave us a hint that we might have too many credit cards. We have between us about twenty cards, all with a zero balance on them. Every time a store offers us a big discount for something based on applying for one of their credit cards we fill in the application and obtain the discount. We never use the credit card, but there is that potential debt amount that we could use in a situation where we need the money. Together with all of the credit cards, we could go into a $60,000 debt situation if we used them all to the maximum, but this is something we would never do.

Can you tell us if this is the problem and can you tell us how to improve my credit rating fast? So that we can be approved for a mortgage and buy the house we have set our dreams on?

 

Category: Home Mortgage Loan APR 3% APR 4% APR 5%
Loan Principal $200,000 $200,000 $200,000
Payment Schedule Monthly Monthly Monthly
Length of Term 15 20 30
Amount to be paid $245,246.91 $280,329.07 $350,410.96
Total interest paid $45,246.91 $80,329.07 $150,410.96
Paid per installment $1,343.82 $1,152.04 $960.03