When it comes to obtaining credit, people tend to make the (unfortunately so common) mistake of simply not being prepared.
Let’s admit it – people spend twice the time trying to shave couple hundred dollars off their vacation cost than they do on a $25,000 car loan, not to mention a $250,000 mortgage.
This chapter will try to focus on the most important steps you need to take to increase your chances of getting approved, and to ensure that you know what you need to do to get the best possible terms.
Steps to take before applying for credit
Perhaps the most common mistake people make is to apply for credit without preparing first. As Benjamin Franklin put it: “By failing to prepare – you are preparing for a failure“. Here are the top 5 most important steps you must take before applying for credit. Any credit.
- Get your free annual credit reports. Check them for errors, and dispute any inaccurate, missing or incorrect information that you find.
- Know your scores, so that you know what to expect. Especially if your applying for a car loan. Either get a free credit score at sites like Credit Karma or Credit Sesame, or pay to get your scores.
- Go online. Check rates from different sites and compare offers BEFORE you head to the car dealer o the mortgage officer. You can find last month’s rates here, or go to myFico for daily updates.
- Know your rights.
- If you can – wait until your score goes above 680.
Here are some invaluable credit obtaining topics:
Credit Reports and Car Loans – What you need to know to get the best possible terms and increase your chances of getting approved.
Bad Credit Car Loans – Coming soon…
Obtaining Credit Cards with no Credit – Coming soon…
Credit Reports and Home Loans – Coming soon…
How to get better terms – A simple tactic to boost your credit & lower your debt-to-income ratio that will increase your chances of getting approved and will get you better terms.
Credit Applications – Know Your Rights – Summary of your rights when applying for credit under the Equal Credit Opportunity Act (ECOA).
Adverse Action Letter/Adverse Action Notice – What to do if your application is denied and what are your rights.
For more information, questions and answers concerning credit applications, APR issues etc please also check out our credit obtaining forum.