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When applying for a home loan, which is better: no credit or bad credit? This is a common question that I get from potential home buyers.
If you have bad credit, the bank can, at least, pull your records. They will see that you're going to be more of a liability than someone with good credit, but they can measure how much of a liability you will be. Bad credit will cost you more in interest, but you may still qualify for financing.
If you have no credit, there are absolutely no records for the bank to pull. You will be a mystery. Banks don't want to be the ones to find out if you are a liability or not, and, therefore, may not want to work with you.
If you don't have any credit, a simple way to build some is to open a credit card. I opened my very first credit card when I got into college. Even though I don't use it anymore, I keep the card open because the tradeline builds your credit and gives you a long credit history, building your credit score.
Ultimately, bad credit is better than no credit when it comes time to get a mortgage. If you have any questions for me, give me a call or send me an email. I would be happy to help you!
If you have bad credit, the bank can, at least, pull your records. They will see that you're going to be more of a liability than someone with good credit, but they can measure how much of a liability you will be. Bad credit will cost you more in interest, but you may still qualify for financing.
If you have no credit, there are absolutely no records for the bank to pull. You will be a mystery. Banks don't want to be the ones to find out if you are a liability or not, and, therefore, may not want to work with you.
If you don't have any credit, a simple way to build some is to open a credit card. I opened my very first credit card when I got into college. Even though I don't use it anymore, I keep the card open because the tradeline builds your credit and gives you a long credit history, building your credit score.
Ultimately, bad credit is better than no credit when it comes time to get a mortgage. If you have any questions for me, give me a call or send me an email. I would be happy to help you!
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