Are you looking for ways to boost your credit before buying a house? Like most homebuyers these days, it’s very likely you’ll find yourself needing the financial assistance of a mortgage lender to make your next home purchase a success. To give you a leg up when dealing with your lender of choice, we’re going to help you whip your credit score into shape with these 3 ways to quickly boost your credit before buying a house in Greater Cincinnati Area.
Check Your History
Before we go any further, the first thing you want to do is request your free annual credit report from a major consumer credit reporting agency.
The intention here is to comb through the resulting consumer credit report for any errors or even debts you may have forgotten, and get these issues resolved. Contacting the credit reporting agency to dispute any errors will ensure you aren’t being held back when applying for a home loan based on incorrect information, which is not unheard of. Second, there’s always a chance that you had lost track of your financial obligations in the past and left an outstanding debt that has slowly chipped away at your credit score.
Doing everything you can to clean things up prior to moving forward will put you in the best position to then begin the process of either repairing or maximizing your credit score.
Budget and Start Making Micropayments
With your history sorted out, it’s time to update your budget to try saving as much money as possible while paying down debts and making things look better on paper.
If you’re looking to boost your credit score before buying a house, don’t just wait until your monthly credit card statements arrive to make payments. Instead, be proactive about paying off your credit cards by making what is called micropayments. These are smaller amounts of money applied to your account throughout the month rather than a lump sum paid all at once.
This helps your credit score by lowering what is referred to as your “credit utilization rate.” Credit utilization is calculated by taking the amount of credit available to you and seeing how much of that credit you’re using up over time. By keeping this utilization low, it shows you have a larger financial buffer zone available to you if needed.
To boost your credit before buying does not mean completely paying off any and all debt, rather minimizing it is the ultimate objective. Oftentimes, credit cardholders are under the impression that keeping their accounts completely clean – without any balance – is the best way to boost your credit score, and this isn’t necessarily the case. Credit is about managing your finances appropriately, living within your means, and displaying your ability to do so over a long period of time.
Raise Your Credit Ceiling
Now that we have established that credit utilization plays a large role in how your credit score is figured out, we can try finding ways to enhance that credit utilization.
The easiest way to accomplish this is by finding ways to give yourself access to more and greater lines of credit. One way to do this is by becoming an authorized user on someone else’s card or account. This immediately opens that available line of credit to you and thereby improves your credit utilization rate.
Another way of achieving this goal is through contacting your credit card companies and requesting credit limit increases without a hard inquiry. The key here is making sure no hard inquiries are done since these can lead to decreasing your credit score.
With these two methods, you’ll quickly be on your way to a better and more enticing credit score for mortgage lenders.
Advice to Boost Your Credit Score Before Buying a House
If you’re buying a home or Cincinnati area property Team Sztanyo has the experience you need to help make the buying process easier, less time-consuming, and we’re on your side to help make sure you get the best deal while we worry about all of the details.
Either way, countless local homeowners and investors trust Team Sztanyo to help them wade through the real estate buying and selling process while keeping more cash in your pocket and helping you save the time and headache of working with less experienced brokers.
If you have questions like: What is the fastest way to raise your credit score for a mortgage?
Should I build my credit before buying a house? Then give us a call! We take the time to listen to your concerns and answer any of your questions here at Team Sztanyo, with no obligation. Contact Team Sztanyo at (513) 813-6293 today!
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