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Resolve to Shape up Your Credit Score

January 14, 2018 8:28 pm
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The new year has begun and you’re making resolutions to improve your health. But what about your financial health? Before you start shopping for new homes in Allen TX you’ll need to get your credit score in shape to get the best deal on a mortgage. Take these steps for a strong credit score in 2018:

  • Start by ordering copies of your credit reports from Equifax, TransUnion and Experian. Look over them carefully for any errors such as accounts that are not yours and old accounts that are still showing up as unpaid after you’ve paid them off. Resolve any issues before you begin to shop for a mortgage.
  • Pay all your bills on time every month. Your payment history is the most important part of your credit score. Mortgage lenders will want to see that you pay your bills on time, every time. If you’re behind on any of your accounts, do what it takes to get caught up as soon as possible.
  • Pay down debt. Keep the debt on each credit card below 30% of your limit, but don’t pay it off entirely. This shows mortgage lenders that you know how to control yourself by not using all the credit that’s available to you. Talk to your lender if you have any questions about which debts to pay down. Often it’s a good idea to pay down debts that are closest to reaching their available credit limit.
  • Don’t close credit card accounts, especially older ones. You want to show a long-term history of wise credit use. However, if you have too much available credit relative to your income, the lender may consider that a risk. Ask your lender for advice first if you do wish to close any credit accounts.
  • Don’t take on new debt. Refrain from signing up for a car loan or other new debt while you’re preparing to apply for a mortgage.
  • Aim for a credit score of 750 or above. Although a perfect FICO score is 850, that level is almost unattainable. Most lenders will give the best deals to those with scores of 750 or higher. At this level, you can shop around for lenders and even choose among competing offers. You should also be offered the best interest rates available.

 

With your credit score in shape, you’ll be ready to shop for new homes in Allen TX. Landon Homes builds award-winning designs in communities throughout the Dallas/Fort Worth region.

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