6 Ways To Improve Your Credit

Credit can be a tricky thing when it comes to buying a house. Here are 6 easy  to understand ways to improve your credit and get you one step closer to your dream home.

6 Ways To Improve Your Credit

1. Check For Errors On Your Report

Always monitor your report closely because identity theft is a regular occurrence, and there may be something on your report that is not yours. If this happens to you call the credit bureaus to correct the error immediately.

2. Keep Your Balance Low

In a perfect world you should pay off your credit card balance at the end of every month, but we all know that generally doesn’t happen. So remember to keep your card balance at 30% of your credit limit, and do NOT max it out.

3. Shop For Mortgage Rates All At Once

When your credit is pulled too many times it will lower your score. However multiple inquiries about your score from the same type of lender could be counted once if pulled in a short period of time.

4. Keep Your Credit Cards Open

You’ve now paid off your debt and want to close your card because you don’t need it anymore. DON’T do it! Keep it open with a zero balance. This will have a better impact on your score than if you close your card.

5. Don’t Open Any New Credit While Purchasing A Home

Buying a home is exciting. Buying new furniture for your home is even more exciting, but don’t fall prey to the 0% financing at your local furniture store or dealership. Lenders will re-pull your credit prior to closing, and if you have opened new lines of credit your chances of obtaining a mortgage could possibly be turned down due to your debt to income ratio being too high.

6. Bankruptcy

If you have ever had to file bankruptcy in the past, you can still potentially buy a home 2 years after your discharge date. Don’t consider renting forever. Keep your paperwork somewhere safe so you can reference it if a lender asks you for it.