4 ways first time home buyers can improve their credit scores
If you are thinking of purchasing your first home, you should know that the higher your credit score, the better your rates will be and the lower your monthly mortgage payments will be. If your scores are not where you would like them to be, here a few things you can do to get them there and keep them there.
Pay your bills on time- even if you have to miss lunch or a macchiato. Your payment history is the most important factor for determining your FICO score.
Balance in full – Don’t carry a balance if you do not have to. Pay it off. However, you do not need to always pay your balance in full, especially if you do not have a lot of credit. That said, it is never a good idea to pay just the minimum. The ONLY one that benefit when you make minimum payment is the credit card company.
Do Not Get Tempted- Apply for credit only when you need it.
Keep Your Card Balances Low – High credit card balances, personal loans, etc., will work against you when trying to purchase your new home. Debt to income ratio is a critical factor when applying for a mortgage. Therefore, if you are within one year of purchasing your new home, it would be in your best interest to skip the latest designer this, that, or other things.
We at First Home Houston is always looking out for your best real estate interest. As always, we thank you for stopping by. Until next time… Diana.
