4 Credit Score Saving Tips for Home Buyers

Are you ready to purchase a home but don’t know where to start? Perhaps the most important step in buying a home begins with your credit. Your credit score plays an integral part in actually securing the funds to purchase your home. Since most of us don’t have thousands of dollars to pay out of pocket, we must seek some sort of financing if we are to end up in the home of your dreams.

Here are some ways that you can ensure you are optimizing your credit and getting the best deal you can on your new home.

Debt Be Gone!

To make sure your credit is in its best shape, you must check on what debts you currently have on your credit. The best way to do this is by checking what is currently reporting on your credit report. Depending on what types of debts show up, this will affect your credit score.

You can ignore most debt caused by medical collections, but other than that, any unpaid bills will put your chances of buying a home to a quick halt. Be sure to have any big debts paid off before you look to a lender to get financed.

Resolve Any Disputes on Your Credit Report

Even though most people know when they have credit debt, there are some instances when the creditor may have placed the debt onto the wrong debtor. Sometimes with common names or even identity theft, this can occur. However, if you have any debts that you disagree with and have disputed with the creditor, be sure to have them resolved before you decide to purchase a home because unresolved disputes can take months to solve and may derail your plans on buying a home quickly.

Recovery Takes Time

If your credit score is less than exemplary, don’t throw in the towel just yet. In order for your credit score to rise to its former glory, make sure you are paying off the debt over time or building up your credit by continuing to pay your bills on time and being responsible with your credit.

However, even if this takes a while, it will all be worth it when you get the keys to your new home. Unfortunately, credit cannot be fixed overnight.

There is one solution…

Even if your credit score is not ideal, there is one way to remedy the problem at least to some degree. If you want a lower interest rate, but your credit is low, you can decide to give a larger down payment and in exchange the lender will give you a lower rate. However, most often, this amount is 20% or more of the purchase price since the lender is taking a larger risk lending money to a borrower with shaky credit. If you need to get into a house fast, a larger down payment is a small price to pay for a place of your own.

 

Share Post:

About Author

Golston Real Estate

Recommended Posts

August 19, 2020
Is This Your Situation: Looking for Capital to Invest in Property?
June 17, 2020
Outdoor Furniture That Beckons You Outside
May 20, 2020
COVID Blues? Here Is Some Good News!
March 24, 2020
What to Know: The Fed Funds Rate vs. Mortgage Rate
February 20, 2020
The Myth of the 20% Down Payment
January 29, 2020
What Buyers Want
December 18, 2019
Latest Data: Where Have Home Values Been…And Where Are They Going?
June 24, 2019
7 Questions to Ask During a New Home Walk Through

15,078 Comments

Leave a Reply

Your email address will not be published.