KHTS Radio Santa Clarita Radio – Santa Clarita News
Though improving a bad credit score can be tough, our reactions to the emotional stress of the situation are often more problematic than the score itself.
Combing through a bad credit report might be so overwhelming that you go looking for a quick fix. Other times you may feel so paralyzed that you do nothing at all. Some may think they’re taking the right steps to building a stronger score, when in reality, the road is much more complicated without professional guidance.
Sponsored Articles
To help set you down the right path, American Family Funding home loan officer Patti Handy shares the top three mistakes people make when trying to repair a bad credit score.
-
Hiring bad credit repair services
“There are a lot of credit repair services that are great, and there are some that are not as reputable,” she said. “So be careful who you talk to.”
If the credit repair company asks for a large payment, such as thousands of dollars up front, that should be a red flag, says Handy. Another factor to watch out for is the life of the credit repair services. Some credit repair companies will temporarily inflate credit; however, the increase doesn’t last very long, so you feel inclined to return to the credit repair company for another credit fix.
If you’re not sure where to turn for credit repair services Handy recommends reaching out to a mortgage advisor who has industry knowledge.
-
Failing to check your credit score regularly
“Many people are tempted to bury their heads in the sand when it comes to bad credit,” Handy said, “and I completely understand that. It’s difficult to navigate, and for many people, a bad credit score can seem like a daunting or insurmountable task.”
Ignoring your credit, however, can be catastrophic for several reasons, many of which may not be your fault. Errors aren’t entirely uncommon, but they can drag down credit in a serious way. Once mistakes or inaccuracies are rectified, a credit score boost can be quick and relieving.
“I recommend pulling your credit report once per year for free at annualcreditreport.com, and your credit score can be pulled for a nominal fee,” said the Santa Clarita mortgage advisor. “Then you can bring it in and go over it with a mortgage advisor to make sure there aren’t unnecessary hits to your score.”
-
Paying off old collections debts
“I see this a lot. People assume that if you pay your old collections off, it will help your scores, but in fact, it actually hurts your scores, temporarily.”
By paying off an old collections debt, it becomes current in your credit history and report, which makes your scores drop for a period of time.
“Again, I recommend seeking the guidance of a mortgage advisor to help you navigate that whole area,” Handy said. “Then you’ll know you’re heading in the right direction.”
Ed. Note: This article is a KHTS Community Spotlight based on a recent radio interview with American Family Funding.
Santa Clarita home loan lender American Family Funding can help you fulfill your dream of home ownership. A highly rated Santa Clarita mortgage lender, American Family Funding maintains a focus on community involvement and a commitment to giving back whenever possible. Friendly mortgage brokers make the first time homebuyer experience an easy and stress-free experience — even with bad credit or a low down payment. The Santa Clarita home loan officers at American Family Funding also specialize in VA loans, reverse mortgages, refinancing and the STAR Loan Program.
28368 Constellation Road
Suite 398
Valencia, CA 91355
(661) 284-1150
info@affloans.com
Do you have a news tip? Call us at (661) 298-1220, or drop us a line at community@hometownstation.com.
