Wondering how you will finance your next big investment? The follow article should provide you with a few avenues you can take to improve your credit score, consulting lenders and qualifying for nonconventional loan programs.

1. Pay debts off and old bills in full
2. Start paying all of your bills on time
3. Attempt to keep your credit card debt to “25% or less of your credit line on each card” (1)
4. No new lines of credit
5. Don’t close any credit card accounts, to avoid using a “higher percentage of your overall credit limit” (1)

Consult a lender

Lenders can tell you minimum credit scores that you need in order to qualify for particular loan programs. Loans that are FHA-insured will have lower credit score requirements compared to conventional loans. When you consult a lender, they will look at several factors in the considering you for a mortgage loan. Realtor.com says that these factors include things such as your “debt-to-income ratio, your income and assets”, in addition to your job history and the amount of the down payment. For conventional loans, according to Homeguides.com, a lender will evaluate your score, which is determined by your “payment history, your salary history, your current wage, your available credit, the scores other lenders are accepting and the current economic climate” (2).

FHA and VA Loans

The Federal Housing Administration (FHA) also offers programs that can help those who have lost a home or had their home foreclosed get a new mortgage quicker than they would otherwise. However, the FHA mortgage program requires one to pay mortgage insurance on this loan, for the duration of the loan period. This mortgage insurance is usually higher than private mortgage insurance (1). The FHA and the Veterans Administration (VA) can finance your home loan if you have poor credit as they look at credit scores differently. A minimum credit score required is as low as 580. This only requires you to make a 3.5% down payment (2). The good thing about loans from the VA is that they are “100% financed and set aside for active and retired military, along with their families”. Requiring no minimum credit scores, VA loans are a way to help you in your journey of buying a house with a poor credit score (as credit scores affect your mortgage loan interest rate). If you’re looking to invest in Aspen’s beautiful valley, contact Portfolio Aspen Properties today to see our Aspen Real Estate Properties! Picture source: http://www.bankrate.com/finance/credit-debt/tips-or-boosting-your-credit-score-1.asp (1)http://www.realtor.com/advice/boost-your-credit-score-to-buy-a-home/ (2)http://homeguides.sfgate.com/minimum-credit-score-needd-buy-house-7410.htm