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Financial Info > Improve Credit8 Ways
to Improve Your Credit
Credit scores, along with your
overall income and debt, are a big factor in determining if you’ll
qualify for a loan and what loan terms you’ll be able to qualify
for
1. Check for and correct errors in your credit
report. Mistakes happen, and you could be paying for someone
else’s poor financial management
2. Pay
down credit card bills. If possible, pay off the entire balance
every month. However, transferring credit card debt from one card to
another could lower your score
3. Don’t
charge your credit cards to the maximum limit
4. Wait
12 months after credit difficulties to apply for a mortgage.
You’re penalized less for problems after a year
5. Don’t
purchase big-ticket items for your new home on credit cards until
after the loan is approved. The amounts will add to your debt
6. Don’t
open new credit card accounts before applying for a mortgage.
Having too much available credit can lower your score
7. Shop
for mortgage rates all at once. Too many credit applications can
lower your score, but multiple inquiries from the same type of
lender are counted as one inquiry if submitted over a short period
of time
8. Avoid
finance companies. Even if you pay the loan on time, the
interest is high and it will probably be considered a sign of poor
credit management
This information
is copyrighted by the Fannie Mae Foundation and is used with
permission of the Fannie Mae Foundation. To obtain a complete copy
of the publication, “Knowing and Understanding Your Credit,” visit
http://www.homebuyingguide.org
Reprinted from REALTOR Magazine Online by
permission of the National Association of Realtors
Copyright 2005 All Rights Reserved
www.REALTOR.org/realtormag
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