Boost Your Credit Score With These Tips

If you're embarking on a journey to purchase your very first home, you might want to pay attention to your credit score. Your credit profile has a major impact on your ability to secure financing and can also influence your interest rate. Therefore, it can be well worth the time and effort to try to boost your credit score in the weeks or months leading up to a home purchase.

Most lenders require a 620 minimum credit score to qualify for mortgage financing (some are even much higher). While your credit score is influenced by healthy credit habits over time, there are still things you can do in the short term to increase it. Here is some advice:

• Start With Your Credit Report
  Before you can improve your credit, you'll need to know what's on your credit report. Your report will contain your actual credit score, and descriptions of each of your credit accounts and your payment history. Keep in mind that there are multiple credit bureaus (Experian, TransUnion, and Equifax), and each has a different way of calculating your score. As a result, your credit could vary depending on which report you pull.
  
  
• Check Your Report For Errors
  Your detailed credit report can often reveal errors or unpaid bills you might not be aware of. Carefully review your report for negative remarks. If you find any, try to pay any missed bills that were sent out for collection or reach out to the credit bureau to resolve the issue.
  
  
• Pay Down Your Balances
  This might seem like a no-brainer, but high credit card utilization can pull down your score. If you have some extra funds on hand, try to make a large payment if possible. However, you may not want to do so if it causes you to eat into your down payment or closing costs savings.
  
  
• Increase Your Credit Limit
  If you can't pay off your balance, you can always try to increase your credit limit. Your debt-to-credit ratio is the total balances across all of your accounts divided by your total amount of credit available. This is a metric lenders use to evaluate how responsible you are with credit. Call your credit card issuer and see if you can increase your line size. This will help reduce your debit-to-credit ratio and could boost your score by a couple of points.
  
  
• Don't Miss Any Payments
  Even one or two missed payments can cause a drastic decline in your credit score. Therefore, you should never skip a payment. Paying the minimum amount is much better than skipping a payment altogether.
  
  
• Avoid Unnecessary Hard Inquiries
  Hard inquiries occur when a lender pulls your credit report. They can have a negative short-term impact on your overall credit score. As a result, you'll want to avoid any unnecessary hard inquiries if possible. Keep in mind that you'll likely have at least one when you go through the pre-approval process with your lender. They typically disappear from your report after one year.
  
  
• Don't Make Any Major Purchases
  Financing a major purchase before buying a home can significantly alter your credit profile. Avoid purchasing a new car or putting a significant balance on a credit card. Doing so will increase your debt-to-income ratio, which can heavily impact your credit. You should especially avoid major purchases after you've already been pre-approved by your lender.

Healthy credit habits play an important role in the home-buying process. Your lender will evaluate whether or not you have a history of using credit responsibly. Practicing good habits is the best way to be prepared when it's time to apply for a mortgage. 

• Spring Décor Updates to Brighten Your Home
• Simple Daily Habits to Maintain a Cleaner Home
• Don't Let Winter Win: How to Freeze-Proof Your Garage
• How to Extend the Life of Your Water Heater
• Winterproofing Windows and Doors: A Guide to Keeping the Cold Out
• How to Future-Proof Your Home for Changing Needs
• Home Happiness 101: Small Upgrades That Can Make Every Day Feel Better
• Fall Cleaning Tips For Decluttering Before the Holidays
• How to Create a Cozy Fall Retreat in Your Backyard
• Why Fall is Prime Time for Window Replacement

• Tips for Transitioning Your Closet From Summer to Fall
• Why September Is the Best Month to Paint Your Home's Exterior

• The Best Home Styles for Enjoying Spring Weather
• What to Do the First Week in Your New Home
• What to Know About Using Gifted Funds for a Down Payment
• What to Know About Using Gifted Funds for a Down Payment
• How to Research Crime and Safety
• What Buyers Need to Know About Home Warranties
• Browsing for Homes Online? Follow These Shopping Tips
• How to Look Past Bad Staging
• What Happens If Interest Rates Change After You Buy?
• How to Compare Two Homes You Love

• Post-Holiday Finances: How to Reset Your Budget for Home Buying
• New Year, New Home: How to Set Smart Home-Buying Goals for the Year Ahead

• Packing Tips for Sellers: Preparing for a Spring Move
• What to Store, Donate, or Toss Before Listing
• What Buyers Notice First in Listing Photos
• How Spring Sellers Can Enter The Market With Confidence
• Tax Considerations Home Sellers Should Know About
• The One-Room-at-a-Time Spring Prep Strategy
• What's the Difference Between Listing a Home and Marketing It?
• How to Respond to Buyer Feedback Without Panicking
• Transparency Builds Trust: Why Honesty Sells Homes Faster
• Winter Selling Myths That Shouldn't Keep You From Listing

• The Value of Local Market Knowledge When Selling Your Home
• Selling in Snowy Conditions: Safety, Access, and Presentation Tips