Did you know that the lower your credit score, the higher your mortgage rates will be?
If you’re thinking about taking out a low mortgage rate in Toronto and want to get a new home, the first thing you should look at is your credit score because it makes a world of difference to maintaining a low mortgage rate.
In addition, keeping your credit score high will help your mortgage broker approve your offer and get through the whole buying process much faster. So, if your credit score is low (meaning between 300 and 500), you should be looking for solutions to increase it.
The good news is that you can improve your credit score if you follow the specific guidelines that we will discuss in this article. Even better, the lower your credit score is, the faster you can bring it up initially. If, for instance, your credit score is 100, you’ll be able to raise it to a decent level faster than someone with a credit score of 500.
With that in mind, let’s go deeper into more ways that you can increase your credit score quickly in order to get low mortgage rates in Toronto.
2 Methods to Enhance Your Credit Score
Become an Authorized User
One way to increase your credit score is to become what’s called an authorized user. What you need is a close relative who has not only an excellent credit score and high credit limit, but also a good history of on-time payments.
You have to ask that relative if they want to add you to their authorized user list. Being added as an authorized user of a good payer adds the account to your credit reports, thus increasing your credit score quickly.
As well, you can instantly benefit from your relative’s good credit score to make payments or take credit. Naturally, you need a relative who trusts you. This is because if you make bad financial moves while being on their authorized list, you’re going to sink their credit score, too, along with yours.
Becoming an authorized user has a potentially high impact on your credit score growth, and the time commitment is low to medium, as you’ll need to talk with the account holder and agree on whether you will have access to the card or not.
Pay Your Collection Accounts
Paying off a collection account removes the threat that you will be sued over the debt. Also, you may be able to convince the debt collection agency to stop reporting your debt once you pay it.
The impact of this method can vary significantly, as an account in collections seriously hinders your credit score. So, if the collector agrees to stop sending reports, your credit score will improve massively in a short period of time.
Contact the Professionals at Northwood Mortgage
There’s actually a lot more to it than what we’ve explored in this short guide. Thus, if you want to improve your credit score as fast as possible, your best bet is to contact experienced professionals who understand how low mortgage rates work in Toronto.
Northwood Mortgage is your logical solution when it comes to credit score improvement, as we’ve helped hundreds of clients improve theirs.