FOX 4 WFTX - Cape Coral, Fort Myers, Naples News, WeatherLooking to refinance? Watch your credit score

Looking to refinance? Watch your credit score

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Thinking again refinancing your mortgage? If your credit score isn’t stellar, think again. Home mortgage lenders use credit scores when determining refinance eligibility, and applicants with sub-700 credit scores may be denied. If they are approved, they’ll likely pay a higher rate — as much as $300 more per month for a $300k mortgage.

“A homeowner’s credit score is crucial when it comes to refinancing a home loan,” said Andy Jolls, founder of VideoCreditScore.com. “If their score is in the 500s or 600s, they could be denied, and some high-end banks won’t consider anyone with a credit score below 700.”

Even if a homeowner with a below average credit score does quality, they shouldn’t expect a fantastic rate. “Homeowners with a credit score under 700 won’t be offered a premium rate, plain and simple,” Jolls explained. “They’re lucky just to qualify.”

Fortunately, credit scores can change, and a homeowner can land a better mortgage rate if he improves his credit score. “Homeowners with the best credit scores are offered the best rates,” Jolls said. “In fact, a credit score over 760 could save a homeowner up to $300 per month on a $300K mortgage.”

Higher Credit Score = Cheaper Home Insurance

A good credit score can help keep home insurance rates low, too.  

“Home insurers use credit scores to assess risk,” explained Layne Kertamus, CPCU® and founder of Negotigator.com. “Their formula is simple: The higher the credit score, the lower the risk.”

Like mortgage lenders, many home insurance companies use credit scores to calculate rates. Statistics show that homeowners with good credit file fewer claims and are involved in fewer fraudulent incidents than those with bad credit, and they’re rewarded with cheaper rates.

If your credit score improves, use it to negotiate a cheaper premium. “A good credit score is a heck of a bargaining tool,” Kertamus said. “If your credit improves, call your insurer and request a rate reduction.” If your insurer won’t decrease your premium, find one that will with free quotes from InsWeb.com.

Whether your credit report is squeaky clean or shot full of holes, a free home insurance quote from InsWeb.com could help you find a cheaper policy. There’s no limit to how much you could save -- $100, $200, $300 per year? Maybe more? Compare free home insurance quotes and find out.

This article is provided by InsWeb Corp. Visit InsWeb.com today to compare multiple home insurance quotes from the nation’s top carriers and local agents.