The Discover Statement is a document that every person applying for the mortgage process must have. If you don't own a house or have never owned one, you may be asking yourself, what is the Discover Statement? In short, it is a form of credit and a financial record.
Your credit history starts at birth, so to speak. The first credit is for things like getting an education and buying your first home. Since those are the things that make it possible to qualify for any type of mortgage, they are called your credit history. When you first get your first credit card or sign up for the first online account, that is also your first chance to show the lender that you are responsible. This can help you to get any type of credit line at all in the future.
Once you have established yourself as a responsible adult, there are two other things that you can do to establish new credit: apply for and maintain a credit card, and pay off those credit cards. If you apply and keep on paying off your credit cards, you will have good credit. A Discover Statement is the record of those activities.
Every time you apply for or maintain a card, your credit score goes down. However, once you start paying off your cards and your accounts, the score begins to rise. This is because, with every payment that you make, your credit score increases.
The purpose of your Discover Statement is to establish your credit history, as well as your financial responsibility. You will need this when you go to apply for your mortgage, and the bank will use it to determine whether or not to extend you a loan. They will want to know how many cards you have open, where they are from, the length of time you have used them for, etc. It may even be used to determine if you are a high risk for a loan. So it's important that you have this document handy.
Just like any other part of your own life, having a great credit history can help you get a mortgage quickly and easily. The first step in establishing a good credit record is to get a credit card. That way, if you have to apply for a mortgage within a few years after obtaining a credit card, you will have already established yourself and your spending habits in that time period. It is easy to get approved for a mortgage when you have good credit, which means that you are a good risk to the bank.
There are a lot of credit card companies to choose from, but make sure that you find one that offers a lower interest rate, so that you will be able to pay off your balance in a timely manner. The amount of time is a very important factor in the mortgage process.
Once you have a credit card that has a low interest rate, make sure you pay it off each month. Doing this will establish your name in the credit report for future reference.
Many people don't realize that their credit cards are actually helping to establish their credit history. When you receive a bill for a specific purchase, your credit card company will deduct your payment from the money you owe on your credit card. This makes it easier to keep track of your balance and credit line. Remember to only charge what you are able to pay in full each month.
If you have more than one credit cards, make sure that you separate those payments and bills. Make sure that you never take out more than you have available on your card, so that you do not become tempted to use the card with the highest interest rate.
One final thing that you should do is to get a mortgage before you purchase your new home. This is a good way to increase your credit score and help the bank to determine if you will be a good risk for the loan you will be applying for.
Remember to have a Discover Statement handy for all your purchases, even those you might make on your next credit card! It may be the most important piece of credit you ever have.