Credit Reports - Before you do anything else, get a copy of your credit report from all three credit reporting agencies. Equifax, Experian, and TransUnion all maintain files regarding your past credit experiences, and you have the right to see the files. In Georgia you are allowed to order two free credit reports from all three agencies each year.
 
You will need this info:
 
Social Security Number _______________________
 
Date of Birth _______________________________
 
Zip Code __________________________________
 
Numerical Address ___________________________
 
City/State/Zip _______________________________
 
If you have not lived at your current address for two years, you will need your previous address information.
Previous Address ____________________________
City/State/Zip _______________________________
 
 
Equifax, Atlanta, GA
800 685 5000

• Order via telephone.
• Select option to order your Personal Credit File.
• Do not select Listing of State Fees, wait for a few seconds and then;
• Order a copy of Credit File only for no charge.
• There is a fee to order your credit score and this number is very important for you to know.
• Report should ship in 48 hours via first class mail, delivery in 7 – 10 days.

TransUnion, Chester, PA
866 887 2673

• Order via telephone.
• Stay on the line through all of the instructions to go to the web site and order report.
• Select option to order your Personal Credit File on the phone.
• Order a copy of Credit File.
• There is a fee to order your credit score and this number is very important for you to know.
• Report should ship in 4 working days, delivery in 6 – 8 working days.

Experian, Allen, TX
888 397 3742

• Order via Internet.
  Go to www.experian.com/freestate
• Complete the online form to order your credit report and then print your report.

By carefully examining your credit history now, you have time to correct errors which can hurt your overall credit score. Sometimes it may take several months to track down errors. Check all three of your credit reports for errors and identity confusion. Your credit score is composed strictly from historical data contained in your credit report, and from nothing else. If that data is wrong or belongs to someone else, your score will not be an accurate reflection of your situation. If you do identify errors, it can take six months or more to correct - the process is slow and painful.
 
Pay Your Bills On Time - Make sure you pay your bills on time, even if it you just make the minimum payment. Skipping a payment is bad and making payments chronically late is worse. Doing either of these will make you look like a bad risk to lenders. Your payment history accounts for more than a third of your credit score, so it is imperative that you pay on time. Also, keep good records of payments so you can prove your payments were timely. If you have been late in the past, be prompt over the next several months. Lenders focus most of their attention on how you have preformed in the past twelve months. If you ever fall behind, get current as soon as you can and stay that way in the future. The Fair Isaac model weights recent activity more heavily than past problems. The most recent six months appears to be critical in the scoring process. Also, check annually to make sure creditors received payments on time. Always challenge late charges. Make sure you stay squeaky clean in the year preceding your application for any major loan.
 
Pay Your Rent Payment On Time – When you apply for your mortgage the lender will ask to verify that you have been paying your rent on time. The best way for you to provide proof is to keep a copy of your canceled rent checks showing the payments were made by the due date. Paying your rent payments with a money order will not provide you with the documentation you need.
 
Credit Cards - Keep balances low on credit cards, and work toward paying off balances instead of just moving them around. Balances near the limit indicate poor credit management, and owing the same amount but having fewer active accounts may actually lower your score. Don’t close or open accounts just to try to improve your score. It may backfire.
 
Avoid “maxing out” any account at any time. The model thinks this means you may be in trouble. Instead, try to show a steady decline in balance owed over a period of time, even if you open additional accounts. Also, try to show installment balances below 80 percent of the original loan.
 
If you are relatively new to the world of credit, go slowly. Don’t go out and open  several credit cards at once. New accounts lower your average account age, and that hurts more when you have been managing credit for a shorter time. But do have at least one active credit card account.

Credit Inquires - Avoid unnecessary credit inquiries. Every time you make an application for credit, that creditor makes an inquiry to your credit history. Each inquiry lowers your score by approximately four or five points. If you have few accounts or a short credit history, each inquiry hurts even more. Furthermore, multiple inquiries are considered a credit danger signal, so take it easy. A common mistake is to go car shopping and allow multiple car dealerships look at your credit. Do not let anyone “check your credit” unless you are ready to make a purchase.
 
Fair Isaac claims that no inquiry is reported when you request your own credit history or when a creditor makes you a “pre-approved” offer in the mail. They also claim to compensate for mortgage rate shopping by counting multiple inquiries during any 14-day period as a single request. So if you plan on doing any rate shopping, get it done in two weeks or less.
 
Bank Accounts - Maintain a bank checking account in good standing at all times. Avoid moving large sums of money around from account to account. If you must move funds, keep track of what, went, where, and why you did it. Mortgage lenders may want to see six months of bank statements, and may question anything out of the ordinary. Likewise, if you receive a substantial monetary gift, you must get a letter from the giver stating the money is a gift “with no expectations of repayment.” Lenders are concerned that you may be trying to borrow funds from a friend or relative to be used for a down payment. That is a no-no. Instead, try to save up as much cash as you can in the months before making your loan application. A build-up of cash reserves is exactly what the lender hopes to see. In their eyes, it demonstrates your ability to live within your means.
 
Large Purchases - Do not make any large purchases or financial commitments in the six months prior to making your mortgage application. Buying a new car may be in your future, but do not do it in the six months prior to buying your home. Not only does it make less cash available for your down payment, but it likely requires another loan with another monthly payment. This new loan will have a negative affect on your debt-to-income ratio.
 
Remember that once you close on your home loan, you are free to change jobs, buy a car, guarantee your friends student loans or declare bankruptcy. Your lender is not concerned with changes to your financial condition after your settlement documents are signed. But in the months leading up to your home loan application, try not to buy anything major, especially a car. And do not load up your credit cards, either. A rising debt level indicates that you may be unable to live on your income. Instead, your revolving debt level should demonstrate a steadily declining balance, even if it’s only a small amount.

How To Apply For Your Mortgage - Meet with a reputable mortgage lender in your community and ask to be pre-qualified for a home mortgage loan. This process helps the lender identify those areas of your application which may need improvement over the next few months and will also result in seeing your credit score. Your score is a three digit number between 300 and 850. It is generated by a computer program based solely on the information contained in your credit report. Because your have three different credit reports, you will also have three different credit scores. Typically home mortgage lenders ignore the high and low scores, and use the middle score as representative of your credit experience. The higher the number, the better the likelihood that you will pay back the loan on time.
 
Remember that each inquiry counts slightly against your score, so restrict your activity to a minimum of lenders, preferably only one. What you really want to see is a list of your “reason codes,” a calculated list of the top five reasons your score is not higher. For instance, if the top reason on all three scores was “insufficient time as a credit consumer,” then there is nothing to do but wait for time to pass. But if one of your top reasons is “too many revolving accounts” or “balances too close to credit limits” then you need to make improvements in those areas.