Post date: Feb 25, 2010 6:23:35 PM

Homeowners Looking For Low Mortgage Rate Must Improve Credit Score; Can It Be Done Fast?

02/24/2010

By Issac Lewis

Homeowners who have seen their credit score fall over the past year due to financial hardships are looking into a number of ways to save money. Most commonly, a mortgage payment is the main area where money goes each month and homeowners are looking to refinance their mortgage for a lower mortgage rate are finding that their credit score is making the record low mortgage rates currently offered unavailable.

Lowering your credit score is something that can’t be done overnight, but if you are in debt and struggling to make your payments you run the risk of defaulting on debt, which will hurt your credit score. However, there are some things you can do to help yourself get out of debt and raise your credit score.

First off, simply paying off credit purchases is the best and pretty much only way to up your credit score. If a lender gives you a loan or credit card and you make a purchase and promptly pay back the debt on time and in full, it reflects well on your credit score. Some people use credit cards for that purpose, as they make purchases each month on the card, despite having the money available, and pay off the credit balance so it will improve their score.

Avoiding debt is the obvious way to stay out of trouble. If you have debt you can pay back and you don’t run the risk of missing payments, then it will help your credit score, but if you are looking at a lot of debt and feel that you’re being crushed it’s time to budget. Paying off high interest debt is going to be the first priority. If you can get rid of big interest debt it can make things easier on you in the long run.

Interest rates that are high, paying the minimal balance, and continually shifting debt from one credit card to another does nothing to help erase the debt. Take the small steps to pay off debt, budget and save wisely, and you will see your credit score improve and things like lower interest rates on refinancing your mortgage will be available.

source:

http://www.rwbpress.com/2010/02/24/homeowners-looking-for-low-mortgage-rate-must-improve-credit-score-can-it-be-done-fast/