UNDERSTANDING YOUR CREDIT SCORE FOR MORTGAGE APPROVAL

Your credit score is very important. It is usually the main reason for you getting a loan or being denied for one. That’s why it’s very important to maintain a healthy credit score. Healthy, meaning checking and being mindful of our credit score. Life doesn’t totally depend on your credit score but whether it’s good or bad but it doesn’t hurt to have an observant eye on it. So what exactly qualifies as a good credit score? What is the minimum credit score required to get accepted for a mortgage in Canada?

 

Mortgage loans are very expensive. They are one of the most expensive loans out there. Mortgage Loan providers always make sure beforehand that their clients are fully capable to pay them back. That’s when your credit score comes into play. They use your credit score to measure whether the borrower can pay back the loan using her/his credit score.

What is considered a Good Credit Score in Canada?

Your credit score can range from 300 to 900 in Canada. 300 is usually someone who is just starting out or has no credit. The higher the score, the better it is; 900 being the best score you can have. A high credit score indicates that you are less likely to default on a loan. Whereas, a bad credit score can indicate you usually default on loans which negatively affect your chances of getting a loan. Don’t Worry, Canadian Cash Solutions is always there to help you.

Here is an example range of credit scores but they can slightly vary depending on the lender:

  •  760-900: Your credit score is excellent!
  • 725-760: You have a very good credit score!
  • 660-725: Credit score is good.
  • 560-660: Your score in this range is considered fair.
  • 300-560: Poor credit score: you really need to work on your score.

Other Things Mortgage Lenders Consider:

1. Your Employment Record:

The money that you are making currently plays an important role in getting the loan. As the mortgage is an expensive loan, lenders always want to make sure that borrower has a steady job and makes a sufficient salary to make loan payments.

2. Your Credit History:

Your credit history report has the detailed record of your credit usage. There are things like your bill payments (late, missed, on time) from your other existing or cleared loans. It also shows all of your credit cards listed in that report. Lines of credit, bankruptcies, liens, etc. will also be listed on your credit report.

How To Improve Your Credit Score?

  • Paying bills in full and on time.
  • Refrain from applying for too much new credit.
  • Be aware of your credit score and check on your credit report.
  • Refrain from carrying a lot of unpaid debts.

A good credit score is a key to getting approved for a loan and at a great rate. For more information on mortgages contact Canadian Cash Solutions today!
 
 

Call us (toll-free) 1(855) 622-8564.

Canadian Cash Solutions - Looking For A Loan?

What would you like to do?