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Homebuyers Advised to Check Credit Report Immediately

By Faye Mergel
Published: Wednesday, November 18th, 2009

With the current housing credit expiring at the end of this month, President Barack Obama approved another legislation that will extend the $8,000 tax cut to first-time homebuyers until April 30 next year. Consumers who are planning to have their own homes for the first time are advised to check their credit report now and make sure that it is free from errors to get the best mortgage deals available.

Homebuyers Advised to Check Credit Report ImmediatelyLegislators say they do not only want to help consumers but also aim to help the housing industry recover from the recession by increasing activity on real estate. However, industry specialists note that first-time homebuyers make mistakes that could have easily been avoided.

For instance, many consumers apply for financing even if they have not reviewed their credit reports yet. Experts say checking a report is necessary to avoid being charged with higher interest rates for fraudulent or inaccurate items. Inaccuracies usually involve late or delinquent payments that have been made several years ago but still remain on a credit report. Those negative marks must be removed from the report if they have been committed seven years ago, experts add.

Another mistake that homebuyers often make is missing on excellent housing deals because they wait too long before making their decision. Specialists say real estate transactions always come with a yes or a no so they tell consumers to carefully assess their finances and the offers available to avoid feeling uncertain when buying a home.

Consumers are advised to know how much they owe and what their current debt obligations are before they talk with a real estate agent. This way, they will know whether they are capable of meeting their mortgage payments. Experts remind consumers that having too many debts all at the same time is the main reason why homeowners fall into foreclosure. Being foreclosed upon does not only make a person lose his home. It also impairs his chances of getting better loan deals in the future since a foreclosure will be marked on a credit report for up to seven years.

Finance issues aside, consumers often regret their purchase if they do not check their neighborhood first. Homebuyers are advised to ask potential neighbors about the things they like and dislike about an area to have a clearer picture of how it feels like to live there. Housing experts also tell consumers to check the neighborhood by laws and see if they feel comfortable living with the rules.

Experts say buying a home does not end with checking a credit report. Homebuyers must also check their new place, too.

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