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Specialists Advise Consumers to Fix Credit Report Before Tax Cuts Expire

By Faye Mergel
Published: Thursday, October 1st, 2009

First time home buyers must get their credit report immediately so they can start working on their record before federal tax credit expires, financial advisers say. The expiry is set to take place in two months but experts say consumers virtually only have a month to finish their transactions.

Specialists Advise Consumers to Fix Credit Report Before Tax Cuts ExpireFinance experts remind future homeowners to get their credit report now from the credit reporting agencies (CRAs) now so they can already start processing their loan applications. The federal housing tax credit worth $8,000 will expire on December, which is roughly eight weeks from now. Experts advise consumers to do the paperwork now before missing out on the discount. They tell home aspirants that processing real estate documents and securities usually take a month, which leaves each consumer only a month to choose a home and find financing.

Specialists say that consumers should start building a more solid creditworthiness as soon as possible so they can find better loan deals for their home purchase. They also tell consumers that checking on their credit report will allow them to detect fraudulent items on their accounts which can seriously impair their chances of getting low interest rates. Identity theft can leave numerous delinquencies and other negative items on a person’s record and, as experts say, those thieves do not stop until they get everything out of a stolen identity.

First time homebuyers are told that fixing errors and negotiating with the CRAs take time so they should immediately dispute any fraudulent item in their credit reports. They say that rectifying fraudulent items is easy and consumers are assured of government assistance. However, it is very time consuming and may keep a person from availing the tax cut.

An $8,000 tax credit is an opportunity that should not be missed, according to home industry analysts, and people are taking advantage of it. In California alone, 40% of the new applicants would have opted out this year, had it not been for the federal tax discount.

Legislators are pushing the deadline for the reduction so more Americans could avail it. However, analysts say that their success is still uncertain so it is best for people who have already made up their mind to buy a home now.

Home industry experts advise applicants to start compiling other documents which lenders require. These include employment forms, payment stubs, bank and asset statements, and a copy of their Social Security card. They remind consumers that their rights assure them of a free credit report every twelve months, so they do not have to spend when getting their copy.

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