Request Your Free Credit Report

• Go to Annual Credit Report's official website and order a copy of your credit report before applying for a mortgage loan. Information on your reports affect mortgage approvals, and a history of lateness or mistakes and outdated information can halt approvals. Check your report to make sure all information is correct, and use the available link to dispute any errors.
  
  

Improve Credit Score

• Qualify for the most favorable rates on your mortgage loan with a high credit rating. A score of 680 or higher justifies mortgage approvals, but for the lowest interest rate on the mortgage, aim for a score in the mid 700's or higher. Timely bill payments are key to demonstrating that you're capable of managing a mortgage and other debts. Pay bills early and ask for an extension if you can't make a payment by the due date.
  
  

Pay Off Consumer Debt

• Increase the amount you're able to acquire by paying off your consumer debts (credit cards and installment loans). Lenders determine mortgage loan approval amounts based on your income and present debts. Several loans in your name and expensive car payments can reduce buying power. Paying off these loans and cards reduce your monthly debt payments and can help you qualify for a higher mortgage.
  
  

Mortgage Broker

• Brokers can assist you with finding a good mortgage loan on your next purchase. Comparison shopping can save you money on the mortgage rate, and you will pay less over the duration of the mortgage loan. Brokers can also outline the various mortgage options available to you and provide information on qualifying for these programs. Talk with a broker and acquire quotes from at least three lenders.
  
  

Avoiding Private Mortgage Insurance

• Property taxes and homeowners insurance are included in monthly mortgage payments. Another insurance called PMI or private mortgage insurance is also attached to mortgage loans without 20 percent equity. Lenders do ask for down payments, and those who are able to put 20 percent down on their new property do not pay mortgage insurance. The exemption of this insurance can reduce home loan payments by a $100 or more. Take money from the sale of your old house or take funds from savings or retirement accounts in order to afford the 20 percent down and avoid PMI.