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    How to Increase Your Credit Score Before You Buy a Home

    Are you tired of paying rent and ready to purchase a home of your own, but have a less than perfect credit score? Having bad credit makes getting a loan for a new home purchase almost impossible. Fortunately there are ways to improve your credit score so that you can eventually buy the home of your dreams. By improving your credit score over time, banks and lending companies will be able to see the progress you are making and will be more likely to provide you with the loan amount that you need. Here are a few simple steps that you can take in order to improve your credit score and stop paying rent forever:

    Credit Score in Louisville KY

    Keep Track of Your Credit Card Balances

    If you have one or more credit cards in your wallet that you use on a regular basis, then you should be aware of the impact that these cards have on your credit rating. One of the best ways to improve your credit score is by paying down your credit card balances each month. If you have a card with an extremely high balance, stop using it to make purchases as least until you get the balance down to a reasonable amount. If you are able to pay off the balance in full each month, your credit rating will improve even faster.

    Eliminate Small Debts

    Many times we will let small debts pile up, convincing ourselves that we will pay them off eventually but get around to doing so. Having several credit cards and charging small amounts on each one will damage your credit over time and cause you to end up paying back much more in interest than you need to. Instead of using multiple department store credit cards to make purchases, use one major credit card that has a low interest rate to make all of your purchases with. Pay off your smaller debts and cancel the cards once the balance has been paid.

    Do Not Remove Old Debt that is in Your Favor

    Many consumers will try to get old debts removed from their credit report even if the debt has been paid in full with no delinquencies. They believe that old debt on a credit report is a bad thing. But the truth is only negative items on your credit report are bad for your credit score. Good debt that was paid on time can help improve your credit rating. It shows that even though you may have made some mistakes along the way, you still have proof of a solid repayment record.

    Pay On Time

    If you are serious about improving your credit score, the best thing that you can do is make your monthly payments on time. Credit scores are determined by the information found on your credit report. If you are constantly making late payments on car loans, credit card bills, cell phone bills, or other debts, expect your credit score to take a hit. This can extend out to bills that are normally associated with credit reporting such as an unpaid gym membership or late DVD rental. Any company that works along with a collection agency in order to collect for an unpaid bill could cause negative activity to show up on your credit report.

    Improve Your Credit Score

    These tips are just a sample of the many things you can do to help improve your credit score. If you are interested in buying a home in the Louisville area and you currently have a bad credit rating, you should take the necessary steps to begin improving your credit score. It may take some time, but once you are able to get approved for a home loan, you will be grateful that you took the time to settle your credit issues.

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