How to Improve Your Credit Score Before Applying for a Mortgage

Check Your Credit Report

• • Obtain Free Copies: Get free copies of your credit reports from the three major credit bureaus (Equifax, Experian, TransUnion) at AnnualCreditReport.com.
  • Review for Errors: Check for any inaccuracies, such as incorrect account information or late payments. Dispute any errors with the credit bureau.

 

Pay Down Debt

• • Reduce Credit Card Balances: Aim to keep your credit utilization ratio (the amount of credit you’re using compared to your credit limit) below 30%.
  • Pay Off Outstanding Debts: Focus on paying down high-interest debts and any past-due accounts.

 

Avoid New Credit

• • Hold Off on New Accounts: Refrain from opening new credit accounts or taking on additional debt before applying for a mortgage.
  • Limit Hard Inquiries: Multiple hard inquiries in a short period can negatively impact your credit score.

 

Make Timely Payments

• • Pay Bills on Time: Ensure all your bills, including credit cards, loans, and utilities, are paid on time to improve your payment history.
  • Set Up Reminders: Use payment reminders or automatic payments to avoid late payments.