Buying a New Home and Your Credit

Danny Skelly  |  March 5, 2021

Buying a home in Florida

Considering a New Home Soon? Start Now and Get a Jump on Improving Your Credit Score – It Can Only Help


In the market for a new home in 2021? There is no doubt it is a seller’s market. It helps if you have more money and can qualify for a conventional loan. It makes your offer stronger and that is the key in a seller’s market when competing with multiple other offers on the same property. Now that we are well into the new year, it is a great time to get your finances in order. Let’s explore a few things that will help you get a jump on improving your credit score before it’s too late to purchase this year.

Grab A Fresh Copy


The first step is to order a fresh copy of your credit report from one of the major agencies. The Fair Credit Reporting Act allows you to access a free copy of your credit report once every 12 months. Now that covid has happened you can even check your credit score more frequently. So, if you have not ordered a copy recently, it is time to do so. You can access this free service through AnnualCreditReport.com, which is a website recommended by the Federal Trade Commission or any of the other many sites that offer free reports. 

Note that it’s not recommended to use a search engine to search for “free credit report” or similar search terms. There are many impostor websites looking to obtain your personal financial information for nefarious purposes. Instead, stick with the government-recommended website listed above.

Clean Up Anything Outstanding


Now that you have a copy of your credit report, it’s time to go through it, line-by-line. You should recognize every current and outstanding account in the report. Any balances owing should be in order and reflect how much you owe. It’s critical that you flag any mistakes or old debts that you have already paid in full. If you come across anything that shouldn’t be on your credit report, call the reporting agency to let them know. If necessary, they will assist you with challenging the issue.

Pay Down Those High-Interest Debts


The final tip in today’s guide is to prioritize your outstanding debts so that you can pay them off more efficiently. The essential debt payments are your mandatory minimums, which you need to pay to avoid being sent to a collection agency. From there, try to pay off your debts with the highest interest rates first. Getting these paid off faster means that over time, you’re spending less on interest payments. Moreover, you can use that extra cash to pay your debts down further.

The above are just a few of the action steps that you can take today to start improving your credit score. When you’re ready to discuss a mortgage for your new home, give our team a call. We will be happy to advise you on the mortgage offer that suits your needs, budget and credit.

Use a Local Lender


It doesn’t matter if you are buying a home in Colorado or Florida you need a local lender that knows and understands the area. Using a national lender may seem like a good idea but it sometimes ends badly.


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