Credit Report and Home Buying are intrinsically related with each other. In fact, the concept of ‘Credit Report and Home Buying’ points out towards the credit-worthiness of a customer, who is seeking loan from a bank or other related institutions for the purpose of buying private or commercial accommodation.
In other words, the credit history of a person as reflected in his credit report, is of much significance when it comes to obtaining loans for home transactions.
Utilities of an individual credit report, at the time of home purchasing:
A satisfactory credit report of a potential home purchaser attracts mortgage lenders tremendously. This is mainly because of the fact, that they are interested in the financial capabilities of the person concerned to pay back the loans taken from them. In fact, the mortgage lenders consider the following factors prior to lending money to the borrowers:
The payment history of the customer
The outstanding amounts whose payment is still due or pending
The length of the credit history of the concerned person is also taken into consideration before offering him/her loan.
A simple and transparent credit history of an individual as a potential buyer of residential properties has high credit rating, and subsequently, a high credit scoring as well. This is an ideal condition for obtaining smooth prior approvals for mortgage.
The credit worthiness of a potential home buyer, as reflected in his credit report not only facilitates him to avail loans easily, but to obtain good interest rates as well.
At the time of lending money to potential customers, the mortgage lenders make an in-depth study and assessment of his/her credit history, to know:
his/her available bank balance
unused credit amounts
any recent credit application in his/her name
In case the customer does not have a credit account in his name, he is then required to produce the following documents to the lenders, in order to get his loan sanctioned and passed:
Documents indicating the timely payments of Utility