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We not only care about getting you into the home of your dreams, but we also care about you and your families’ financial health. With March being National Credit Education Month, we wanted to highlight this important topic.
Having a conversation with a mortgage professional is a great start to figuring out a game plan to ultimately improving your credit. Our mortgage professionals have a wealth of knowledge and a wide variety of resources to share with you.
Keep these tips in mind as you start your homeownership journey:
Do not open a new store credit card just to save on a purchase. New accounts can lower your score. It also makes it difficult to manage payments for multiple accounts. Saving 10% on a $300 lawn mower doesn’t make much difference if it costs you even just fractionally more on a $300,000 home loan.
Do not open new accounts just to transfer balances for an introductory rate. In addition to possibly lowering your score, these offers often have traps. Instead, use them to leverage a lower rate from your existing card company.
Do not close old accounts. It will benefit your score if you have a good record of payments on old accounts. Using these accounts occasionally and conservatively will keep them active and contribute toward a good score.
Do not be afraid to use credit. You will have no score if you do not use credit. Having no score can be just as bad as a low one. Keep a high credit line and a low balance. Credit utilization ratios measure this relationship, and lower is better.
Maintain a variety of account types. A combination of revolving, installment and secured financing along with excellent records of payment will yield a higher score. Still, don't run out and open an account just to have diversity, as this is the least influential factor.
At the end of the day, let a professional be the judge of your credit situation. We offer a variety of products to meet the requirements of borrowers with a wide range of credit profiles. Our high level of commitment is to work with you to find the right mortgage product to fit your individual needs.
Contact us today to see how you can qualify for your dream home.