Entering into a real estate transaction can sometimes open a Pandora’s Box. This isn’t meant to scare you out of buying a piece of property. This is meant to give you information to better arm yourself against one of two possible situations that we hope never happen, but can. These two scenario’s have to do with your personal credit.
Let me play out the first scenario, it is more common than you might think. You’re shopping for a house, you find the perfect place and you’re ready to make your offer. You visit your bank to get pre-qualified and surprise, surprise you find a skeleton in your credit closet. Only this skeleton is not a phone bill that you forgot to pay when you were in college. This skeleton was created by someone else, someone you don’t even know and most likely, they don’t even know you-nor do they care. You have just found out that you have been a victim of identity theft and it’s keeping you from buying the house of your dreams.
The second scenario is common and typically our own fault, even if we weren’t aware it was our own doing. That is simply neglecting our own credit. Slow pays and no pays will adversely affect your credit and the worst part about it, you may no even be aware of the effects until years after the initial “oops!”
When considering the purchase of a new home save yourself and your Realtor a headache and run your own credit. Know for yourself what others will eventually learn about you. Doing this could also help you explain any items that might raise some concern with possible lenders, not to mention, you’ll know what your score is and won’t have to rely on someone else’s interpretation.
Visit the website of the three major credit reporting agencies (Experian, Equifax, and TransUnion) for more information about your credit score. Also visit www.flippingfrenzy.com for information about mortgage fraud and how you can protect yourself from unscrupulous lenders.
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