Wednesday, April 13, 2011

Why NOT to Dispute Credit Reports

Many credit repair companies advise their clients to dispute accounts on their credit report, telling them the accounts will be removed from their report. That is horrible advice. Here's why:

  • When you dispute a credit account, lenders are now required to underwrite loans manually, rather than using the software that allows higher debt-to-income ratios. If a borrower is approved for a loan by the software with a 50% debt-to-income ratio and they have disputed an account, the manual underwriting guidelines say that the debt-to-income ratio must be lowered to:
    • 36% for conventional loans
    • 41% for VA loans
    • 43% for FHA loans
  • If you dispute an old, unpaid collection account, the collection company will now know you are trying to improve your scores, and they may start trying to collect from you again. Your credit scores will drop.
Never advise anyone to use a credit repair company. Everything you can possibly do to raise your credit score is available for FREE from The Mortgage Experts. Give us a call for the details.

All the really cool real estate agents send their clients to the video library on our web site.  Here is the link:

Getting a loan approved is easy - if you know what to do. The Mortgage Experts know what to do!!!

If you want your loan to close, call us at 303-345-3683.

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