Preparing For a First-Time Loan: Steps to take before applying

Getting a mortgage for the first time is both exhilarating and frightening at the same time. There are a lot of unknowns the first time you apply for a mortgage loan and unknowns always tend to raise your blood pressure slightly.

Before you apply for a mortgage it is a good idea to get a copy of your credit report. There are places online which will offer to get your credit report for free, but it may be necessary for you to pay a few dollars to make certain you have a complete and accurate credit report.

Start by looking for any obvious errors. Errors creep into credit reports from time to time. If you suspect an error contact the credit reporting agency immediately and talk to someone about the problem. Find out what you need to do to resolve the problem and then do it. Do not apply for a mortgage loan with a negative error on your credit report.

If there are any genuine negatives on your credit report takes steps to correct them. Start by talking to someone at the credit reporting agency and ask if they have any suggestions for how to improve your credit score.

Naturally you�ll want to make certain that you are up-to-date with all of your credit card and other payments before approaching a mortgage lender. If you have more than two major credit cards (such as VISA, MasterCard, American Express, or Discover Card) it might improve your credit rating if you were to cancel all but two cards. Cancel your credit cards even if you never use them and even if you pay off your balance every month.

If necessary take out a consolidation loan and pay off all of your cards � and then cancel all but two.

Think like a lender. Lenders want to see consistency and reliability as much as anything else. They want to know that you are the type of person who takes care of your debts month after month after month and that you have the resources to service the mortgage you are seeking.

By taking just a little time to make sure your credit report has no unexpected surprises in it, you can make your mortgage experience a much faster and more pleasant one � and you will insure that you are offered the best rate and terms possible on your new mortgage.