Credit Boosting Secrets for First-Time Homebuyers

We’re approaching that season where the leaves begin to change color, pumpkins are displayed beautifully on front porches, and don’t forget that perfectly layered autumn wreath hanging on front doors.

Families hire photographers to come over and snap stunning portraits of the enchanting, vibrant season as they wear matching flannel shirts, toss leaves in the air with a fit of laughter, and capture the essence of their loving family, in their most sacred environment- home.

As a credit expert helping individuals and families become empowered and established with their credit scores and savings, one of the most common requests I receive is how to successfully prepare for first-time homeownership when dealing with debt or poor credit.

If that’s you, and you desire to purchase your first home and grow (or maybe even start!) your own family, then today’s article is a must-read!

First, I want to remind you that you are worthy of owning your own home, and ultimately receiving what you desire. I know it can feel overwhelming if you’re currently in debt, being rejected by loan companies, or experiencing all-around exhaustion any time you even think about your credit score.

It breaks my heart when clients come to me in tears believing it’s impossible to buy their first home, ashamed to communicate those concerns with their loved ones.

What do I always tell them? That it’s simply not true! And that doesn’t have to be their story.

In fact, there are many possibilities available to you right now that can assist in boosting your credit score and prepare you for the home hunting process in ways that are practical and liberating. 

Here are some of my top tips to get you started (plus, if you’re interested in hearing more from me and my good friend + mortgage lender, then be sure to tune in for my upcoming masterclass!)

  • Pay off, or lower balances on debts/credit accounts with small balances. It’s common for mortgage lenders to make buyers with average credit scores pay off debts/credit accounts with small balances to improve their income-to-debt ratio. However, if you cannot pay off the full balance, try to reduce it.
  • Get your bills up to date. If you’re not current on your bill payments, pay the bill as soon as possible to get a quick credit score boost.
  • Check your credit score many months before buying. It takes time to improve your credit score, check your report well in advance to work on improving it if necessary.
  • Keep your debt-to-credit utilization ratio below 10%. To calculate this ratio, divide your accumulated credit accounts debt by the credit limit on these accounts.
  • You have to build credit in advance. The longer credit history you have built, the more favorable your mortgage application will look and you will obtain a higher credit score and better report. You need six months of an open account with a payment history to get a score.
  • Know what credit score you need to buy a house. Credit scores range from 300 to 850, with 850 being considered a “perfect” credit score. To buy property, you should aim for at least a 700+ credit score to get the best interest rates and save money. However, a lower score can still qualify you for a mortgage, depending on your situation, type of loan, lender, and location.

So put that stash of Halloween candy away- no need to dive into a chocolatey sea of tears….although, treat yourself to that Snickers bar because we’re celebrating the fact that this is more than possible for you!

These insider secrets will put you on the fast track to turning your dream home into your home. Be patient with the process, as it does take time, but find relief in knowing it’s not Mission Impossible.

Soon, your family portrait will be hanging on the wall of your new home, and you’ll be elated you chose to start taking action today!

xo

Jeanne

Share this article: