St Louis and Kansas City Credit Expert

“I’ve been turned down for my mortgage because I have a bad credit score. How can I raise my credit score high enough to qualify for a mortgage?”

Market trends are preventing anyone with a score less than 620 from getting a mortgage.

If your score is less than 620, you’re either turned down, waiting forever, or paying for it with a higher rate and higher costs if your loan closes at all.

Credit scores are more than just payment history. They are a complicated mess of history, credit utilization, account types, inquiries and many other factors.

So How can a raise my score?

Homestead Financial has credit improvement services at both our St Louis MO and Kansas City Locations that can help you raise your credit score to qualify for your new home purchase or to consolidate your debt into a new mortgage with a low rate. Call and speak to one of our loan officers about our credit improvement services.

Credit Improvement tips. Did you know???

Paying off an old collection on your credit does little or nothing to help your score.

Don't close unused credit cards as a short-term strategy to raise your score. Owing the same amount but having fewer open accounts may lower your score

While the scores varies by state and month, the average credit score in the US around 692.

"What credit score do I need to qualify for a mortgage?"

In today’s market, any borrower needs a minimum credit score of 620 to qualify for a mortgage.

So how can I raise my score enough to qualify for a mortgage?

Homestead Financial has a free credit improvement (for both St Louis and Kansas City) service that can help you raise your credit score to qualify for your new home purchase loan or to consolidate your debt into a new mortgage with a low rate.

How it works:

The service is normally applicable to those with a score ranging from 550 to 619.

We take the credit report from your application and enter it into our computer simulated model based on the 3 credit reporting repositories. The model gives us a 30 day plan with detailed instructions, and a step by step process of actions to take, helping you raise your credit score to from where it is now to a range above 620, which is what banks are looking for in this market.

The process takes about 1 month to improve your score.

In our experience, it comes down to a few details that need to be focused on to improve your score to take a turndown and turn it into an approval.

Fees associated with our service are normally free to nominal. Call and speak to one of our loan officers about our credit improvement services.

Credit Improvement tips. Did you know???

Paying off an old collection on your credit does little or nothing to help your score.

Even though you pay everyone on time, your score may be dropping because of the amount of credit you have outstanding against your credit limits.

Many creditors are slashing credit limits as people pay down their existing debts, further lowering your score.

Credit Improvement tips. Did you know???

Paying off an old collection on your credit does little or nothing to help your score.

Even though you pay everyone on time, your score may be dropping because of the amount of credit you have outstanding against your credit limits.

Many creditors are slashing credit limits as people pay down their existing debts, further lowering your score.

Don't close unused credit cards as a short-term strategy to raise your score. Owing the same amount but having fewer open accounts may lower your score While the scores varies by state and month, the average credit score in the US around 692.

10 Rules to follow to have a good credit score.

1. Pay your bills in a timely manner. This is the best way to improve your score. Even if you’ve had serious delinquencies. They will count less over time if you keep paying your bills in a timely fashion.
2. Keep credit card balances low. High outstanding debt can pull down your score. Don’t go maxing out your credit cards and just make the minimum payment.
3. Check your credit report for accuracy. It’s possible that there may be inaccurate information on your credit report that can be easily cleared up (see If this proves to be the case, then you should contact one of the three credit reporting agencies — TransUnion, Experian or Equifax.)
4. Pay off debt rather than moving it around. Consolidating your credit card debt onto one card or spreading it over multiple cards will not improve your score in the long run. The most effective way to improve your score is by simply paying down the amount owed.
5. Keep your credit cards – but manage them responsibly. In general, having credit cards and installment loans that you pay on time will raise your score. Someone who has no credit cards tends to have a lower score than someone who has managed credit cards responsibly.
6. Don’t open multiple accounts too quickly, especially if you have a short credit history. Opening too many accounts in too short of a time period can look risky because you are taking on a lot of possible debt. New accounts will also lower the average age of your existing accounts, something that your FICO score also considers.
7. Don’t open new credit card accounts you don’t need. This approach could backfire and actually lower your score.
8. Don’t close an account to remove it from your record. It’s a myth that closing an account removes it from your credit report. This is untrue — even closed accounts remain on your report, possibly for an indefinite period of time and may still be factored into the score. In fact, closing accounts can sometimes hurt your score unless you also pay down your debt at the same time.
9. Shop for a loan within a short, focused period of time. FICO scores distinguish between a search for a single loan and a search for many new credit lines, based in part on the length of time over which recent requests for credit occur. If you shop for a number of loans over too long a time period, it can count against you.
10. Contact your creditors or see a legitimate credit counselor if you’re having financial difficulties. This won’t improve your score immediately, but the sooner you begin managing your credit well and making timely payments, the sooner your score will get better.

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Mortgage Rates as of 7/31/2010 Term Rate APR 30 YR FIXED 4.000 4.134 15 YR FIXED 3.625 3.862 5/1 ARM 3.250 3.788 3/1 ARM 3.250 3.706 Quoted rates are based upon Fannie Mae maximum loan amounts prior to any score, income verification or equity based adjustments. Call today for specifics. Endeavor Capital, LLC D/B/A Homestead Financial Mortgage Kansas Licensed Mortgage Company #2004-4670. State of Illinois Division of Banking Department of Financial and Professional Regulation Illinois License # MB.0006030

 

I cannot thank Homestead Financial enough. They helped my husband and I to secure a loan or our first house. Their knowledgeable staff helped us to navigate the entire loan process from the beginning to the closing date, and made it all easy for us to do. We got a really good rate and were treated like valued customers – and not just another anonymous set of names and numbers.

Thank you again for all of your help,

Michelle & Matt R.
Creve Coeur, MO