If you start paying attention to your credit score at the same time you begin your house search, there’s a good chance you’re going to be disappointed. Long before you begin your house search, you’ll want to start tuning up your credit score. It can take months to get your score right where you want it to pass the approval process and get a good loan rate.
In this article, we’ll take a closer look at the things you should focus on to fine-tune your credit score before you begin your new house search.
Eliminate Late Payments
Late payments can put a big ding on your credit score. You don’t want to have any late payments during the past 12 months when you apply for approval. If you have trouble paying your credit cards on time because you forget, just set up the autopayment option, and you’ll always know your payment went through on time.
Unpaid Collections, Judgements, or Tax Liens
If you have any of these on your credit report, they will act as a big red flag to lenders. These are considered more serious than late payments and can substantially lower your credit score if ignored. They will also stay on your report for up to 7 years. A credit repair specialist can evaluate your situation and help you make a plan that deals with these in the most efficient way possible that makes sense for you.
Create a Monthly Budget
The only way to have true control over your finances is with a budget. A monthly budget takes the guesswork out of managing your finances. It frees you from worrying about what’s coming because you already know. Establishing a monthly budget doesn’t take much time, and once you have, it changes very little from month to month.
Pay your credit cards off or down as much as you can. Do not close them, however. Do not apply for any credit prior to 6 months of applying for your mortgage loan. If you can maintain a zero balance on your credit cards when it’s time to apply for your loan, that’s going to help a lot.
Can a Credit Repair Company Help You?
The bottom line is a higher credit score means better loan rates and more purchasing power for your new home. Higher credit scores can result in saving thousands of dollars over the life of a mortgage loan.
Credit expert LLC has helped countless homebuyers fine-tune their credit scores before applying for a home mortgage. We can help you raise your credit score to 700 and beyond.