Are you ready to refinance your home? A home refinance in Texas can help you save a lot of money. However, if your FICO score is not high enough, you can be denied or lose out on favorable interest rates. To refinance a home in Texas, it is recommended you have a FICO score in at least the mid-600’s.
Increase Your Home Equity
What can you do if your credit score is below the recommended number? If you have cash available, you could pay down on your home. By paying extra interest on your home, you can increase the difference between your home loan amount and your home’s value. The more equity you have in your home, the less risk you present to the lending institutions for default. Although, this option might not always benefit you.
Improve Your Credit Score
In many instances, the only way to get a good interest rate is dependent upon your FICO score. What do you do if you have a less than optimal credit score? There are several steps you can take to improve your credit score to get a better interest rate for a refinance in Texas.
Review Your Credit Report
The first step is to review your credit report. Once you’ve reviewed your credit report, you can fix any errors. While errors are infrequent, they do happen. What can you do to fix errors? If several of your creditors are reporting a late payment, but you were only late one time, then you can call your creditors. When you call them, you can ask for the information to be taken off your credit report based on the fact that you were only late one time. Your creditors might not remove the late payment, but they definitely won’t, if you don’t ask.
Set Up Payment Reminders
Another way to address late or missed payments is through payment reminders. With a reminder system, you can avoid missed and late payments. Do your creditors accept direct payments? If you still have significant issues with getting your payments made on time, you can set up your bills as direct payments. Many creditors will even give discounts for direct payments.
Reduce Your Debt
While reducing your debt is easier said than done, your FICO score will greatly benefit from lowering your overall debt. One way to see a quick increase in your credit score and be able to refinance in Texas is through paying off or paying down debts. As you pay off these debts, you should roll those designated payments into another debt. This works because the more available credit you have, the higher your credit score will be.
Contact Signature Lending Services Now
In conclusion, your FICO score is important when applying for a refinance in Texas. If your credit score is low, you should focus on increasing your scores before applying for a home loan refinance. If you want expert advice to guide you through the process of applying for a home refinance loan in Texas, contact Signature Lending Services. We are an industry leader. To get started with a home loan refinance, call (214)-681-3540.