Increasing Your Borrowing Power
Here are some tips to help you make the most of your money:
Don’t Deplete Your Savings
Lenders often look at your cash reserves. They don’t want you to empty your savings accounts in order to afford your mortgage payments. For this reason, avoid making other major purchases in the year you plan to buy.
Borrow with a Co-signer
You may be able to borrow a larger amount or get a lower interest rate if you borrow with a co-signer. Consider this option carefully. You will both be held responsible if you default on the loan.
Track the Current Housing Market
Look at the current buyer’s market and interest rates. Are rates increasing or decreasing? The lower the interest rate, the more home you can afford.
Patch Up Bad Credit
Get a copy of your credit report from each of the three credit bureaus (see below). Make sure that there are no mistakes on it that could cost you—or even prevent you from getting financing. Pay all of your creditors in full and on time for at least a year before you want to get a mortgage loan. And try to avoid changing employers. The better your credit rating, the more you’ll be able to borrow—and at a better interest rate.
The Three Credit Bureaus:
- Experian www.experian.com (888) 397-3742
- Equifax www.equifax.com (800) 685-1111
- TransUnion www.transunion.com (800) 916-8800
When you're ready to take out a loan, remember that Delaware State Police FCU offers a variety of loans to meet all of your borrowing needs. Visit our loans page to find out more.