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Obviously having excellent credit is to the benefit of prospective borrowers. But what about those borrowers that have had some credit problems over the years? Can they still get a mortgage? And, what must they do to overcome any problems they may have. These and other questions are the focus of this Article. It is designed to give some general information and sources of assistance, not to be exhaustive as a credit repair tool.

Borrowers with less than perfect credit may still qualify for a mortgage depending upon the degree of the problem and the amount of money they have for a down payment or the amount of equity they currently have in their home if refinancing. Very recent late payments, outstanding collections and judgments, recent bankruptcy and other unpaid items will generally cause an application to be denied. If you are not sure of your credit situation you should contact your Mortgage Loan Consultant to review the reports with you. A Lender or Broker will need your permission to pull your credit history.

Federal law carefully regulates how information about your credit can be used. The Equal Credit Opportunity Act (ECOA) mandates that every consumer who applies for credit have an equal chance to obtain it. This is not a guarantee that credit will be granted, but rather that the factors used to determine whether an application is accepted or rejected will be consistent and consistently applied for all applicants.

The Fair Credit Reporting Act (FCRA) ensures that consumers' rights and privacy are protected even as the credit reporting industry makes it possible for credit histories to be transmitted so quickly that stores can offer instant credit to consumers who qualify.

The federal government maintains several Web sites with a variety of information about consumer credit issues. The following two relate to the FCRA specifically:

• For a summary go to http://www.ftc.gov/bcp/conline/pubs/credit/fcra.htm
• For the text go to http://www.ftc.gov/os/statutes/fcra.htm

The law guarantees your right to dispute inaccurate information on your credit report free of charge. If you find an error in your credit report, simply call or write to the credit bureau. The bureau will check with the source of the information and send you an update. The dispute process can take up to 30 days. If you still disagree with the information, you can add your own statement to the credit report. There are three major credit bureaus Equifax, Experian and Trans Union. To dispute inaccurate information on your credit reports contact all three bureaus. In your letter be sure to include:

• Your full name, first, middle and last and including any applicable suffixes
  (Jr., Sr., II, etc.)
• Your complete mailing address
• Your date of birth
• Your Social Security number (this is necessary to access your credit report)
• The name and account number of the creditor and item in question
• The specific reason for your disagreement with the disputed item
• Your signature

If you have serious credit issues and it appears that your loan application would be denied your Broker will generally not recommend that you apply at this time but rather work to improve your credit before making application. There are a variety of Credit Repair companies and services available on the Internet.  Just do a general search under “credit repair” to locate one that will meet your needs. HHFC does not make any recommendations or warranties as to quality, integrity, or service of any of these sites. We will be glad to work with you and explain the issues that we see in your reports that will need to be addressed in order to qualify for a mortgage but we cannot dispute or repair your credit for you. That is something you must do on your own.