Along with the amount of money you make and the debt you have, your credit score is a vital factor in whether you get a mortgage or not. Below are some tips to help you keep your credit score as high as possible. A high credit score means a lower interest payment, lower down payment and a higher qualifying amount.
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Make sure you check your credit often. In our economy, identity theft is growing at a rampant pace.
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Credit cards can be a challenge. Try to pay them off every month, or at least pay more than the minimum. Refrain from using credit on items that will not appreciate.
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Don’t use those credit cards to the maximum amount available. This will lower your score significantly.
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If you have credit problems, wait more than a year to apply for a mortgage. The longer you show a good payment history, the better.
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If you apply for a mortgage, make sure you have closed on the loan before charging all the new items for your home.
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Don’t open any new credit accounts before closing on your mortgage. You might qualify at the time you apply, then you buy a car, and when it is time to close on your home, your credit will be denied because you have too much debt.
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Shop for your mortgage loans all at one time. It is understandable to see the credit inquiries when you are making the big purchase. It is not desirable to have inquiries spread out over a short period of time.
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Avoid finance companies. Their rates are usually higher and are usually the only alternative for people with bad credit.
If you have any questions about your credit, please let me know. I work with lenders that will be glad to counsel with you.