Everyone has a right to address incorrect items on their credit report. However, home buyers should be conscious of the impact that it can have on getting home financing. This article includes important details on disputed credit accounts and the effect on Singer Island FL mortgages.
Before Starting Your Home Search
If you are intending to buy a home in the future, be diligent about reviewing your credit score several months in advance. This allows you the time to find and resolve mistakes prior to applying for a loan. Ideally, you would want any disputes addressed before starting the home buying process. If you do have any active disputes, inform your mortgage consultant early in the process. Do not assume that it was seen on your report during the pre-approval process.
What Are Disputed Credit Accounts
If you find a mistake on your credit report, you have the right to correct it by submitting a request to the credit bureaus. A notation is added to your credit file and the accounts are considered disputed credit accounts. Credit bureaus may opt to ignore the particular items when calculating your credit score, so they might not impact your score while in process. Typically, the notation is removed once the mistake is resolved and, if applicable, the proper corrections are completed. This process can take many months. Even though you may not see a reduction of your score, the information on the dispute may result in other issues.
Disputed Credit Accounts And The Effect On Singer Island FL Mortgages
Many lenders implement electronic underwriting systems. Your credit score and other aspects of your credit report are evaluated by the program. Disputed credit accounts may lead a loan application to be denied or sent for manual underwriting. Gather all documents and information related to the disputed credit accounts. If it was a debt that you paid off but was not properly credited, have statements showing the debt owed and verification of amounts paid. Also write a letter clearly explaining the situation. All of this can improve your chances of having the loan approved. Keep in mind that many mortgage companies may not approve an application if there is a dispute on file, regardless of the circumstances. This is implemented in an effort to minimize fraud but, unfortunately, can sometimes hurt consumers with reasonable claims. To be safe, it may be best to resolve credit issues before applying for financing. It is important to speak to a financial advisor for personalized advice on your financing needs. To be referred to a local expert, Sonny Solomon at The Keyes Company at 561-247-1047 or email@example.com.