Mortgages lenders use automated underwriting (AU) software like Fannie Mae's Desktop Underwriter (DU) to make informed credit decisions on conventional conforming, non-conforming, and government loans. This software saves the lenders a lot of time and resources in making loan decisions. But, what this software can't help with are errors in a borrower's credit report. It can only report what it sees before yielding one of the following results:

• An acceptable result of : Approve/Eligible, acceptable Approve/Ineligible, Expanded Approval - Levels I, II, or III/Eligible, acceptable Expanded Approval - Levels I, II, or III/Ineligible; to a

• Refer/Eligible, which translates to a credit barrier that keeps the borrower from being recommended as approved for the loan; to a

• Refer/Ineligible, which means the borrower isn't eligible for the loan.

The Federal Trade Commission (FTC) says that inaccurate credit reports are the number-one source of consumer complaints, and that it is quite common for problems to take six or more months to be resolved. These mistakes are what can disqualify an otherwise qualified borrower or give them a AU Refer Eligible rating that would require extra steps in order for the borrower to potentially qualify for the loan. This is why lenders need credit repair to get their clients qualified.

Derogatory accounts are damaging to your FICO credit scores. The types of derogatory information that can appear on your credit reports are listed below in order of descending importance with the first item being the "most damaging" to your credit.

Credit Repair Analysts Can Help

1. Bankruptcy
2. Foreclosure
3. Repossession
4. Loan Default
5. Court Judgments
6. Collections
7. Past Due Payments
8. Late Payments
9. Credit Rejections
10. Credit Inquiries

Removing discrepancies, collections, judgments, charge-offs, bankruptcy and foreclosure and getting mortgage late payments removed can result in greatly increased credit scores, which could made a huge difference between the borrower getting qualified and in the interest rates the borrower will pay on the loan. Getting 30-day late, 60-day late and 90-day late information removed will help a great deal, as well.

More than 40 percent of the consumers surveyed by the U.S. Government Accountability Office (GAO) in 2004 hadn't checked their credit reports for errors. Federal law now entitles you to one free report every year from each of the three national credit bureaus: Equifax, Experian, and TransUnion. Get all three at www.annualcreditreport.com, and steer clear of other Web sites that offer "free" reports only if you subscribe to their expensive credit-monitoring services.

It takes a while to get these reports, so if you're pressed for time, just call the credit bureaus to order your reports:

Experian: (888) 397-3742
Equifax: (800) 685-1111
TransUnion: (877) 322-8228

Once you receive your report, review it for errors. This also includes outdated items. For example, if you had a derogatory account, but it's over 7 years old, you should be able to get it deleted. If you don't want to handle this yourself, there are reputable companies that can help.

Credit Repair Reviews analyzes the credit repair agencies. Go to Credit Repair Reviews to see who is rated in the top 5. Then do some research on your own to determine which one would best suit your needs. We can't make any recommendations on which credit repair agency to use because an agency that works well for one person may or may not work well for someone else. Our lenders could also help you by answering questions about your credit report that pertain to qualifying for a mortgage loan. Give us a call today!