It’s important to have a higher credit as a homebuyer. Here’s why you need it and how it can help or hurt you.


Today I want to talk to you about saving money and maintaining good credit. When you buy a home and have a 20- or 30-year mortgage, having bad credit will cost you a lot more money in interest than if you had a high credit score. Here are some tips to help you raise that credit score and keep it up:

1. Maintain a low balance on your credit card or revolving line of credit. Make sure you pay that credit card balance off every month. You may have some emergencies to pay for and you may not be able to pay those off right away. That’s fine, but make sure you pay it down as soon as possible. If you have multiple cards or lines of credit, pay off the credit with the highest interest rate first before anything else.

2. Set up automatic bill pay. Most creditors will allow this, and it will help you from forgetting to send in the payment and will always make sure your bills are paid on time.

“Closing all of your accounts at once is also a big red flag to lenders.”

3. Shop in 30-day increments. If you’re going to purchase furniture or a car, don’t do it all in the same month. Each time you have your credit pulled, it lowers your score and throws up a red flag to lenders.

4. Reconsider closing your accounts. Closing all your accounts at once is also a big red flag to lenders. It’s okay to leave them at a zero balance for a while and close them over a long-term period.

Be responsible with your credit. It takes a long time to get good credit, but it takes a lot longer to fix bad credit. When you buy a home, the higher credit you have, the less interest you’re going to pay on your mortgage.

If you have any questions for me in the meantime or need any more advice on maintaining your credit, don’t hesitate to give me a call or send me an email. I look forward to hearing from you soon.