Credit is a tricky subject. It is a crucial factor when you are looking to get a mortgage. It is also one of the things that people struggle with most to keep in check! That is why we have crafted 5 tips to keep your credit in check and allow you to qualify for the best possible rate!
1) Pay down credit cards. The number one way to increase your credit score is to pay down your credit cards so they’re below 70% of your limits. Revolving credit like credit cards seems to have a more significant impact on credit scores than car loans, lines of credit, and so on.
2) Limit the use of credit cards. Racking up a large amount and then paying it off in monthly installments can hurt your credit score. If there’s a balance at the end of the month, this affects your score – credit formulas don’t take into account the fact that you may have paid the balance off the next month.
3) Check credit limits. Ensure everything is up to date as old bills that have been paid can come back to haunt you. Some financial institutions don’t even report your maximum limits. The best bet is to pay your balances down or off before your statement periods close.
4) Keep old cards. Older credit is better credit. If you stop using older credit cards, the issuers may stop updating your accounts. Use these cards periodically and then pay them off. Maybe buy gas once a month with your credit card and then pay it off right away. Regular use of credit can be positive in your credit score!
5) Don’t let mistakes build up. Always dispute any mistakes or situations that may harm your score. If, for instance, a cell phone bill is incorrect and the company will not amend it, you can dispute this by making the credit bureau aware of the situation. Call Equifax at 1.866.828.5961, Monday – Friday 8:00am – 5:00pm to enquire about your credit.
Following these tips can help ensure that your credit stays in check and help you qualify for the sharpest rate! If you have made some “credit blunders” though, check out our Credit Medic guide below to set yourself up for success!
Credit Medic for You & Your Mortgage Your credit score is a huge factor in getting a mortgage, and it won’t go away. The first thing Lenders do when they look at your application is to look at your credit score. From there, they build your file. It is...