What Information Do I Need to Run My Credit for a Home Loan?

Most young couples dream of creating a home for their families. This dream starts with homeownership and mortgages. Before you start looking at mortgages, you need to run your credit to find out what your credit report says about you. Once your credit report is in hand, your next step is to fix inaccuracies and pay down your utilization ratio. After fixing your credit, you want to approach potential mortgage lenders to run your credit for a home loan.

Free Credit Report

Every person gets free access to all three of their credit reports -- from Equifax, Experian and TransUnion -- once per year. Free credit reports are also available to anyone denied credit or unemployed. You may also get your credit reports from each credit bureau for a small fee. Your credit report shows your entire credit history and provides the foundation for approval or denial of a mortgage loan. When you go to the website set up to supply the free credit reports, annualcreditreport.com, you need to provide your full name, date of birth, Social Security number and addresses for the last two years. You will have to answer questions specifically from your credit report -- such as your current credit payments, previous addresses and counties of residence -- to verify your identity. When you pass all checks, your credit report generates for your review.

Credit Score

Your credit score provides a snapshot of your creditworthiness. While it is used in mortgage loans, a full review of your credit report and financial history is used to approve your loan. Purchase your credit scores to find out where you stand. You must pay to get your credit scores from the credit bureaus. Each credit bureau maintains its own score.

Remove Inaccurate Information

When it comes to your credit report, your rights are that information you believe is inaccurate must be investigated by the credit reporting agency and removed if found to be inaccurate. Once you file a dispute, the credit reporting agency has 30 days to investigate and remove the item if found to be inaccurate. The bureau must furnish the results of the investigation to you along with a new copy of your credit report if something is removed or updated.

Reduce Your Balances

High credit scores work in your favor when it comes to applying for a mortgage. A high credit scores results in lower interest rates on your mortgage loan. You want to optimize your credit score by making it as high as possible. Reduce your credit card balances to no more than 25 percent of their credit limits. Credit utilization, a key factor in determining your credit score, takes your total credit card balances and calculates their percentage in relation to the total of all your credit limits. Keeping credit utilization under 25 percent shows you know how to handle credit and helps increase your credit score.

Mortgage Approval

With your credit history in great shape, approach credit lenders for a mortgage loan. Mortgage creditors need access to a whole host of paperwork to approve your loan. They want your identification, tax returns, W-2 forms, pay stubs, lists of your creditors and investment records. The underwriting process verifies all your information and approves or denies your application based on the lender's criteria.

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