First, make sure your credit history is being reported accurately. Don't be fooled or ripped off by companies that will charge you a lot of money and promise to remove negative credit from your report.

You cannot remove accurately reported information. But, you can make sure what is there is correct. And there are ways to improve your score. The section on credit repair goes into greater detail and will show you how to do this. Remember, You can do it yourself.

Funds to close
The money you are going to use for your down payment and closing cost typically have to be sourced and seasoned for three months. If you already have your money in an institution (bank, CD, 401k,) you are ok. However, if you have $20,000 under your mattress and intend to buy a house with it today, you would be turned down.

Lenders must see that you have had the money for three months, they must see where it came from. So, put the money in the bank and leave it there for three months.

Some loan programs will allow a gift. (FHA and a few non-conforming lenders) However, even the gift must be sourced and seasoned in some cases. The are a few programs that do not source and season funds but the interest rate is considerably higher.

Rent
If you are renting your home or apartment, ALWAYS pay by check. It is the only way you have proof that you paid on time.

Some loan programs require twelve months cancelled checks! I have seen people turned down because they can't produce 12 cancelled checks. Money orders usually will not work. And of course, Always pay on time.

Mortgage
The same applies here as rent payments, ALWAYS pay by check. If a lender miss-reports your payment history, cancelled checks are the only way to correct it. Or if your mortgage is with a private party the cancelled checks will be mandatory.

Typically lenders look for the past 12 month mortgage history on your credit report. If you do not pay your mortgage by the end of the month, your mortgage carrier will report a late payment to the credit bureaus. Late payments will not only affect your ability to get a new loan, it will also decrease your credit scores and will greatly affect your interest rates.

If you can not guranatee that your mortgage payment will arrive to your mortgage carrier to post by the end of month, you can either pay your mortgage online or by phone. Call your mortgage carrier and they can help you make sure your payment will post by the end of the month. There is usually a small fee for this service.

Bills
Calculate your debt to income (DTI). If it is a little high, pay off some of your smaller bills.

Installment loans are not counted if you owe less than 9 payments.

Revolving accounts must actually be closed or the minimum payment will be used to calculate your DTI even if you have a 0 balance.

Lenders don't like to see a lot of revolving accounts. Get rid of them. It will also increase your credit score.

Collect your documents
You will be required to bring to your broker the following documents. They cannot even start your loan without them and they must see the originals so don't bother making copies, your loan officer will do that for you. Don't leave the originals with them.

You will need to collect: 3 months bank statements, all pages, all accounts. Last 2 years W2's and or complete tax returns if you are self employed or paid on commission. One full month of pay stubs from your job. Divorce papers. Bankruptcy papers. 12 months cancelled checks if your rent/mortgage is paid to a private party.

There may be other documentation requirements depending on the type of loan and your situation. For a list of required Legacy Mortgage documents needed please go to our Download page to download the list.

Don't
Change Jobs.
Open any new accounts.
Be late on any payment.
Have any NSF checks show up on your bank statements.
Allow anyone to run your credit. If you are shopping around for mortgage rates, ask for a copy of you credit report. You can then request that any other mortgage company to please do not run your credit and give you a Good Faith Estimate based on your current report. (please note credit reports are only good for 90 days with lenders)

Do
Make your mortgage payments ONTIME! No matter what your loan officer tells you or when you think your new loan is going to close. ANYTHING can happen and if your loan is delayed, and your payment shows up late not only will your credit suffer, but you may no longer qualify for the new loan.