4 Secret Tricks To Boost Your Credit Score When Buying Toronto Real Estate
Your credit score is a magical three-digit number that can affect your mortgage rates as well as your ability to qualify for a mortgage at all. Your credit score is lowered by a number of things, such as carrying a high balance, missing payments and applying for new credit.
Lower your credit score before jumping into the Toronto Real Estate Market.
Before jumping into the home buying process, getting pre-approval for a mortgage is crucial.
When being pre-approved, lenders will look at your credit score and this will affect what kind of mortgage terms you could be given. Before the pre-approval, you should do all you can to increase your credit score.
Pay your bills sooner
Some lenders will report the balance that is on your account during the last statement date, but paying off your balance sooner than required could result in your new, lower balance being reported instead of a higher one, increasing your score. Not all cards work this way, and not all lenders report based on the last statement date, but you can call your lender and ask when your balance is reported. This can also be achieved by making smaller weekly payments instead of payments once per month, although again you should call your lender and see if they can handle multiple payments – some lenders have a limit.
Ask for a break
Sometimes banks or lenders are willing to waive certain fees just to be nice to a longtime customer, and the same can go for your credit report. For example, if you usually pay your bills on time but one late payment is marring your credit report, you could ask them to remove it as a good-will deletion. Removing as many black marks as possible can increase your score, and if the first person says no – keep escalating your call to someone higher up the customer service chain.
Make collection agencies work for you
If you have an account in collection, the collection agency may have already reported the account to the credit bureau or be threatening to do so. Feel free to barter with your collection agency and offer payment on the account in exchange for deletion of the black mark off of your credit report. Don’t offer to pay in full right away, because these agencies buy debt for only pennies on the dollar. Start by offering a 30 per cent settlement and go from there, and always ensure you get any deal with a collection agency in writing before giving them any money.
Beware of short sales
A short sale in real estate is when a home is sold for less than the mortgage. For example, you have a mortgage of $400,000 on your home, but you only sell it for $350,000 – thus owing the bank $50,000. This can affect your credit report in a serious way – just as much as a foreclosure. Talk to your bank and negotiate as much as you can in order to have them not report the owed balance.
4 Secret Tricks To Boost Your Credit Score When Buying Toronto Real Estate is a post from: Toronto Real Estate | Toronto MLS Listings | Toronto Homes For Sale