It’s time to talk about the C word. That’s right - your credit score. Now, before you search “How to get a good credit score,” you have to understand the basics of how your credit score works.
Whether you fit into the good, bad or “just OK” category, understanding what your credit score means and how it plays a role into buying a home is important.
C – Calculating Your FICO Score. FICO is an independently operated company that’s not owned by any credit bureau. Their formula calculates a consumer’s credit score and provides you with several other score models that help calculate your score based on a variety of factors. It’s our job to walk you through this part of the process.
R – Researching ways to improve your score. There are things you can do on your own to improve your credit score. This part plays a role in the process because we analyze things like missed payments, maxing out your credit cards and things of that nature. You want to make sure you’re utilizing your credit in a way that will benefit you in the long run so if you can, focus on paying down those cards and making sure you’re paying your bills on time.
E – Educating yourself on what documentation you will need to provide. We wrote a whole blog on this for your reference: getting your docs in a row blog....
D – Debt: It’s something nearly everyone has, but no one really talks about. We can work with you on a plan to get your debt down to lock in a better rate on a home. We can provide you with tips and tricks to get this down on a plan that works best for you!
I – Improving your credit. This is obviously important, but if you don’t have any to begin with, how can you do that? Well, if you don’t have a credit history, there are absolutely ways you can establish this. Speak with your mortgage banker to discuss best practices to do this.
T – Talk to a mortgage banker. This is the best place to start on your credit journey. We’ve been in the industry long enough to really hone in on your credit history and we’re ready to help you get the home of your dreams!
Getting your credit squared away will significantly help with applying for a mortgage. Most importantly, it will help you get a home loan that you can afford paying off and help you afford the house you’ve been keeping tabs on. For more credit score tips get in touch with a mortgage banker to get a personalized solution and path to home buying.
(1) This information is for educational purposes only and should not be relied upon by you. (2) Credit score improvement is not guaranteed. (3) This information is not intended to replace the advice of a legal or financial professional.