When you go to purchase a new home, your credit determines many of the conditions related to your loan. It stipulates whether you get a loan at all, and it helps determine what interest rates you qualify for. Improving your credit the year before you decide to buy a home will benefit you long term, because you’ll save thousands on interest. The path to get there isn’t too difficult, but it helps to know what will give you the greatest impact.
Bills, mainly. Bills that are over 30 days late can kill your chances of getting a home with a good interest rate. Make sure you pay everything, even your cell phone bill, on time. If you have credit cards, you might also try a bi-weekly payment system for yourself. It helps reduce the amount of monthly interest you will pay out, and it keeps your balance at a lower and more manageable rate. Next would be inquiries and claims. If someone has rejected you for a credit card recently, stop asking around and work on improving your situation. In addition, make sure that you do not have inquiries against you. If you do have charges on your account, file disputes as needed and get them cleared from your record.
Get your annual free credit report and review it for accuracy. Make sure that you are aware of the companies that inquire about your credit, and that you do not have inquiries that are inaccurate. If you do have charges against you, your credit report will typically help you identify who to pay.
: Kuba Jewgieniew leads one of America’s fastest growing real estate brokerages through a data-driven approach. The agents of Realty ONE Group use technology to enhance the sales process, and pair buyers and agents up like never before.