Your loan approval is not final until day of settlement, so here are a few tips that will ensure you keep your approval:
§ Stop spending money you don’t have.
If you have a budget, stick to it. If you don’t have one, make one.
§ Pay your bills on time.
Credit scores emphasize your most recent payment record. Paying on time raises your credit score. If you’ve been late, start paying on time!
§ Pay at least the minimum amount required.
You can always pay more – and it’s a good idea if you can afford to. But you should never pay less than the minimum.
§ Keep your credit card balances low.
Don’t “max out” your credit cards – that can lower your credit score.
§ Limit your credit.
Applying for a lot of credit in a short period of time may concern lenders that you won’t manage your debt well. It may be tempting to open a new account to pay off other accounts, but it is a dangerous trap that can cost you money and actually hurt your credit rather than help. Only apply for credit when you need it.
§ Keep your debt-to-income ratio at 40%.
Generally, you should not have debt that’s more than 40% of your net monthly income.
§ Establish credit if you don’t have any.
Open a free or low-cost checking or savings account and make regular deposits. Only write checks when you have money to pay for things. And apply for one or two credit cards, use them carefully, and pay them off each month.
§ Don’t pay off old collections or charge-offs. If you’re not sure, consult with your credit coach to determine which, if any, accounts should be paid.
§ Use bankruptcy as a last resort.
Filing for bankruptcy can keep you from getting a loan for a long time, raise your interest rates, and stay on your credit record for 7 to 10 years.
