I see this everywhere “Free Government Credit Report” I think People are confused with the news about Government Mandates Free Credit Reports for All Consumers. The Fair Credit Reporting Act (FCRA) requires each of the Nationwide Consumer Reporting organizations (Equifax, TransUnion and Experian) to provide you with one free credit report every 12 months per your request.
Anyways, there is no free federal government credit report online, you must go to freecreditscore.com and provide your information.
Now that that’s cleared back to our subject.
First you need to look into your credit score and finances, bank accounts credit card accounts other loans you may have.
Get all your credit cards, store cards, loans and bank statements.
Write down all account numbers and their current balances, you can also put them in an excel spreadsheet or word.
Are you buying your home in cash? Probably not. You are going to get a mortgage from a bank or a mortgage company.
Before you go to the bank and ask for a loan you should find out what these lenders are going to see in your credit report. You need to make sure that everything listed on your credit report is correct and from now on you should monitor it closely. If you have not gotten your credit report within the past 12 months you can get it free at freecreditreport.com or free credit reports from government (just kidding, annualcreditreport.com). Another place where you can get and monitor all 3 credit reports is credit.com. Ohh you had no clue that there was 3 credit reporting agencies? Well, welcome to your other life. All the credit cards, car loans or anything you do as far as credit goes is reported to these 3 credit reporting companies, Experian, Equafax and Trans Union. Why 3 companies? Who cares, too late, it’s the way it is, concentrate on what you are doing now. Trying to buy a home.
Ok, back to your credit report. After you have gotten your credit reports go thru them with a magnifying glass. Make sure your name, or names are listed correct, all your credit cards are listed and reporting the correct balances.
Check the credit inquiry section this is where you can see who requested and was looking at your credit report. If there none listed you are good to go, otherwise, you need to make sure these inquiries are legitimate meaning you authorize the credit card or bank to look at your credit. If you did not authorize them then you need to dispute them. See How To Dispute Credit Inquiry.
Warning: If you dispute anything in your credit report DO NOT apply for any type of credit until the dispute is cleared from your credit report. Trust me, I had to go thru this mess. This process could take anywhere between 30 to 60 days.
So what does it take to get the best interest rate possible:
credit score 740+
not currently 30 or more days past due on any debt obligation
not 60 or more days past due on any debt obligation within the preceding 24 months
not a debtor in a bankruptcy proceeding,
not subjected to property repossession or foreclosure,
not engaged in a short sale or deed-in-lieu of foreclosure
not subject to a federal or state judgment for collection of unpaid debts within the preceding 36 months
Debt to income ratio 28% to 36% or less
Down payment = 20% min
Closing cost = about $10k not including real estate agents fees that can range from 3% to 6%. I did not get real estate agent as I bought and dealt direct with seller.