There Are Circumstances That May Actually Hurt Your Score!

If you're not careful, certain circumstances can actually bring your credit score down - the last thing you want to happen when you're ready to buy! This tip is not mandatory, but it is a suggestion that may increase your credit score. However, there are circumstances in which it may actually hurt your score. Understanding the difference can make or break your loan. Lenders like to see a borrower who has a credit history of at least five open trade lines or credit accounts. These could be major credit cards, an auto loan, a student loan, gas cards or department store cards. Typically they like to see that at least three of the accounts have a history of 24 to 36 months. This shows them that the person they are considering lending money to has a history of paying bills on time.

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Are You Credit Ready?

Think of a time when you had to give a presentation, perform in a production or play in a sporting event. Were you prepared? Did you practice? I bring this up because, too often, we don’t prepare ourselves for buying a home. Your credit is a key component to the loan, interest rate and terms of the financing that you ultimately end up with. Being prepared and ready to move quickly is instrumental when buying a home. Don’t wait until you are ready to buy to run your credit. Run it six months before. This is, most likely, the biggest purchase you will ever make in the time you have on this planet. So be ready. You will not have a low credit score due to erroneous, derogatory items if you take the time to fix those months before you apply for your loan. Even a slightly higher credit score could save you thousands of dollars in interest over the years. So get yourself in the credit ready position. If you need help or guidance getting there, talk to your mortgage professional.                

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