My tip of the day comes from my real estate guide - “The Truth About Credit“. Applying for a mortgage can be a confusing event. To many real estate buyers, it’s something akin to a spin of the roulette wheel - you never know what’s going to turn up. However, you don’t have to go into your meeting with the bank unprepared. My real estate guide will help you prepare for that meeting by giving you some valuable tips about the process. Here’s an example:

1. ABC’s of Mortgage CreditMortgage lending ABC’s gets its name from the grading of credit based on such things such as payment history, account balances, bankruptcies, equity position, and credit scores.

When trying to figure a credit grade, keep in mind the following principles: ·  - When you have derogatory credit, all of the other aspects of the loan need to be in order; equity, stability, income, documentation, assets, etc., play a larger role in the approval decision. ·  - When determining your grade, various combinations are allowed, but the worst case will push your grade to a lower credit guide; mortgage late payments and bankruptcies are the most important. ·  - Credit patterns are very important. A high number of recent inquiries and more than a few outstanding loans may signal a problem. A “willingness to pay” is important; late payments in the same time period are better than random late payments as they signal an effort to pay even after falling behind.