In this installment of Ask the THD Experts we will answer some frequently asked questions about refinancing and credit scores.
What credit score is needed for refinancing?
One thing is for certain, your credit score will have a big impact on the refinance rate you will be offered. Lenders generally use credit score bands – which are algorithms that create numerical ranges used for lending decisions.
Here is an example of FICO Score ranges and what they mean:
740-799: Very Good
Why does our lender want us to close credit cards before the loan is granted?
If the borrower has a high Debt to Income (DTI) Ratio, a lender might request that you close a credit card account(s) in order to qualify.
While closing a credit account could lower your credit score, it would be a minimal change. Your score would be recovered within a year or so.
Is there anything I can do to raise my credit score, before refinancing?
Absolutely. At THD Credit our program is geared to produce results quickly and efficiently. In as little as 45 days your credit reports can be cleaned up in order to get approved for mortgages, refinances, lines of credit and auto loans. Click here to schedule a free consultation.