Credit Strengthening Tips

Your credit score plays a crucial role in your ability to secure a home loan. It not only influences your eligibility but also impacts the types of loans available to you and the interest rates you’ll receive. As a nonprofit mortgage company, we offer complimentary credit evaluations to help you understand your status. Additionally, we provide personalized credit strengthening services to help you improve your score and achieve your homeownership goals.

In this post, we’ll give you some tips on how to improve your credit score before applying for a mortgage.

1. Review your credit report: The first step to improving your score is to review your credit report. You’re entitled to a free report from each of the three major credit bureaus (Equifax, Experian, and TransUnion) once a year. Reviewing your report will help you identify any errors or negative items that may be dragging down your score.
2. Pay your bills on time: One of the most important factors in determining your score is your payment history. Late payments can have a major negative impact on your score, so make sure to pay your bills on time.
3. Keep your credit card balances low: Another important factor in determining your credit score is your credit utilization, or the amount of credit you’re using compared to your credit limit. Aim to keep your card balances below 30% of your limit.
4. Limit new credit applications: Every time you apply for credit, it can have a negative impact on your score. Limit the number of new applications you make, and only apply for credit when you really need it.
5. Consider a secured credit card: If you have poor credit, you may want to consider getting a secured card. With a secured credit card, you’ll need to put down a deposit, which will serve as your credit limit. This can be a great way to establish a positive credit history.
6. Keep old accounts open: The length of your credit history is also a factor in determining your score. Keeping old accounts open can help improve your score.

It’s important to keep in mind that improving your credit score takes time, so it’s best to start working on it as soon as possible. Consult with a mortgage professional to understand what score is required for the loan you’re applying for and what options you have.