improve your credit score

5 Ways to Improve Your Credit Score Now

If you are looking to buy a home, your credit score can make a huge difference in the overall price of your home. From lowering interest rates, to determining a down payment, make sure you do all you can to get your credit score as high as possible. Here are 5 ways to improve your credit score now.

5 Ways to Improve Your Credit Score Now

Check your score

Just like anything in life, if you don’t know where you stand, it’s hard to improve. There are many online sites that allow you to see a snapshot of your credit score as well as specific categories that could use improvement. These sites pull from the three largest reporting agencies: Equifax, Experian and Trans Union. By checking your score on a regular basis, you’re able to see your improvement and spot any errors right away to improve your credit score.

Think twice about opening new lines of credit

Having too many hard credit pulls can lower your score quite a bit, so check how many hard pulls you’ve had this year. If you are nearing the limit, it might be a good idea to hold off on opening a new retail card. Additionally, it’s best to keep working on exiting lines of credit to make sure they regularly up your credit limit, so your overall credit allowance is higher. On the other hand, if you aren’t planning for a mortgage for weeks or months, and have an opportunity to improve your credit score by opening a new line, go ahead and move forward.

Leave unused credit lines open

After you’ve paid off your balance on a retail credit card, the credit line generally stays open for 12-24 months after closing. Call the credit company to let you know of the exact time frame. This means that if you have a Best Buy credit card open and you recently paid off the balance, buy something else (even if a very small amount) on your credit card to keep it open. You may even experience the company offering to raise your credit limit which is a good thing for your overall credit.

Assess your financial ties

If you are on a joint account with someone with less than stellar credit, consider removing yourself from the account. By being on a credit line with someone else, their actions can dictate a change in your credit score. The last thing you want is to have put in months of effort of improving your credit score, only to be dropped by someone you share a car loan with.

Show stability

If you plan on obtaining a mortgage anytime soon, it’s best to show stability with your address or job. Showing stability won’t necessarily affect your credit score, but it will make you a better loan candidate to the lender. Your lender will want to see that you are in good standing financially before granting a loan.

You may also like: 5 Things You Didn’t Know Could Affect Your Credit Score.

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  1. […] This is one of the top lessons learned about VA loans by previous home buyers. Credit flexibility is perhaps one of the biggest benefits for choosing a VA home loan. However, just because you can obtain a loan with a 580 credit score, doesn’t mean you want to. If you have the time and ability, try to do all you can to raise your credit score before applying for a VA home loan. The reason for this is because buyers with lower credit scores are charged with a higher interest rate. Just working a year on credit score can raise it over a 600 which will help lower your interest rate, and lower your monthly mortgage payments. This will save you money throughout the life of the loan. For tips on raising your credit score, visit: 5 Ways to Improve Your Credit Score Now. […]

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