As we move in to the fall in Denver,
the housing market is still very strongly in favor of sellers. If you are looking to purchase a home, this
means that you have to be an aggressive, ready, and willing buyer to be able to
purchase. Part of that process is to
make sure that your credit is in good shape.
Typically, most lenders are looking for a credit score of at least 640
to be able to qualify a buyer for an FHA loan.
Some lenders offer different products that can qualify buyers under 640,
but remember that with credit scores, the higher the better.
So how do you continue to build/improve/repair your score?
The easiest way to improve a credit score is
with credit cards. While credit cards
are convenient, it is important to make sure that you consistently are paying
off your cards. Opening a credit card,
especially a secured card, and paying them off on time, will be the fastest way
to increase your score.
Current Debt- instead of transferring debt to a
different card or account, paying off the debt before opening a new line of credit
is crucial. Plan ahead by scheduling
calendar reminders in advance of when payments are due, that way you don’t get
behind on payment and also never forget.
3. When managing current lines of current don’t
open additional lines of credit too rapidly as this can ding your credit
score. Typically wait a few months
before opening lines of credit.
4. Your Debt to Income or Credit Utilization Ratio-
Keep this under 20%. So for example if
you were to have a credit limit of $5,000, make that your debt is not more than
$1,000. These numbers are not something
to stress over, understanding what they need to be and keeping them in mind
will allow you to have a higher credit score.
5. How to pay of your debt. Believe it or not, but all debt is not the
same. It is smart to avalanche your debt
payments. This means to make sure that
you are paying off the debt with the highest interest rate first. Once that is paid off, move to the next highest
interest rate. The faster you can eliminate
the higher interest rates, the higher your credit score will be, and even
better the more money you will keep in your pocket. When you are looking to purchase a home, or making a larger
purchase in general, keep your credit score in mind. The more work you do to keep a higher credit score
now, the more money you can save over the long term. Curious what your home is worth?
Use our FREE online valuation tool Click Here! Michael Kane is a Broker Associate at
Keller Williams. He is a member of the Carr Peck & Associates team that is
recognized locally and nationally as in expert in real estate. Locally he is a
member of the Denver Metro Association of Realtors. Nothing brings him
more joy than making his client’s dreams become a reality! For more
information feel free to contact him or call 303-717-9284. Statistics provided by msn.com Image courtesy of google.com
Author:Jason Peck Phone: 720-446-6301 Dated: September 15th 2014 Views: 915 About Jason: ...
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