Many people who go into deep debt promise themselves that they will never borrow again. After experiencing bankruptcy, they want to avoid getting themselves into debt at any cost. Credit scores are devastated through declaring bankruptcy and it is quite easy to see why no one wants to go through with it again. In case you haven't heard of it, credit scores are basically the numerical way that your credit worthiness is identified for the creditors. Your numbers will let them know what they need to know about you. If you don’t have a good understanding of the numbers I will clarify it for you.
• 300 to 500 is very bad.
• 500 to 600 is bad, but you will still be able to get a mortgage, or a very high rate auto loan with this score.
• 600 to 700 is poor but then again you can still obtain a mortgage with a reasonable down payment, or a high rate of auto loan
• 700 to 800 is just OK
• 800 plus is good
Having knowledge of this, you will then know that credit scores aren’t just used for the use of borrowing. These numbers will affect for sure just about every aspect of your future financial life. Below are a few examples of the types of companies that use them in order to decide whether to do business with you and further to that, they will also set up your payment rates:
• Employers
• Auto, Life, and Health Insurance
• Apartment Rental
• Bank Accounts
• Utility companies are also trying
So even if you don’t want your life to be determined by your credit, you will really need to use a mortgage in order to rebuild your credit scores. A mortgage might sound ridiculous as it is a major debt but it is really a great method for you to prove your worthiness. A mortgage is the fastest, safest and easiest, overall best way to rebuild your scores. This is how and why:
• Quick – You cannot just do anything that will move your credit scores higher or faster than a mortgage. This is because it is a larger debt and carries a lot of weight in your scores as a result.
• Simple – Whether you believe it or not when you get a decent mortgage, it is in fact much easier that getting a decent credit card or car loan. Pre-approval is a great method for you to go about it, as long as your bankruptcy hasn’t been filed sooner than 6 months ago.
• Safe - You might already be paying rent for your house or apartment, so why not pay to own them? It is a debt that you will have to pay in the long run anyway, so why not make it work to your advantage?
• Makes sense - Mortgage lenders are considered by your credit scores as the same as a bank loan. They are not third rate lenders like the credit card, auto loans, personal loans that are always there for you. Third Rate Lenders have a negative effect on scores, but mortgages are looked at as a real asset. So getting one is an absolutely sure way to make your score improve.
Get out of bankruptcy fast with our effective tips! click to the next page: Mortgage Options 2
