Five Habits to Break for Home Purchase Credit Worthiness

Five Habits to Break for Home Purchase Credit Worthiness

03 Feb 2015

Follow these steps to achieve better credit
Whether it’s a resolution for 2015 or even 2016, it’s time to start preparing for a new and improved credit score. Purchasing a home is a big step, and it can be made easy with some simple solutions. Here are five habits to break in order to get your credit score back in shape.


Swiping Plastic


Is your credit card maxed out? Break the bad habit of maxing out your credit cards and resolve to creating a realistic, conservative budget that you can stick to. Put away some money each month that will only serve to pay off those credit card bills. Not only will your credit score improve, you’ll also save on interest rates. As a general rule of thumb, try to keep your balances at or below approximately 50% of your credit lines to increase your credit score. Utilizing less than 50% of your credit indicates a worthy borrower.


Ignorance Doesn’t Mean Bliss


Although you may not know your credit score, lenders and banks will when you approach them for financing. Your credit score showcases your spending habits so put your best foot forward and create a pathway of credit success. Create the habit of checking your credit score regularly in order to monitor your finances and spending. In addition, it is good to check your credit report for inconsistencies. By law, the credit bureaus must provide you with one free credit report per year. Visit the FTC’s website to gain access to your free report. We suggest pulling a report from one of the three credit bureaus every four months. This way you can review your credit report each quarter for any potential issues.


Meet More Than the Minimum


Paying only the minimum balances makes it difficult, even impossible in some cases, to pay off large credit card debts. Smash the habit of paying just the minimum and commit to paying above the minimum amount. You will see results faster and soon reap dividends on interest savings and a higher credit score.


Being Late


No one is perfect. As humans, we all have the tendency to forget something, arrive tardy to a meeting, or sometimes we simply become distracted by life’s twists and turns. If you are interested in improving your credit score, the easiest step you can take is to start paying your bills on time. Timely payments with balances below the 50% utilization threshold factor positively impact your worthiness as a borrower.


Don’t Rack ‘Em Up


Do you apply for a new credit card every time a reward program is released? Lenders are wary of house hunters who have amassed an excessive amount of credit cards and overspend. Break the habit of over credit-utilization and accept novel credit scarcely. Similarly, the length of your credit accounts are also factored into your credit score. Accounts that have been open longer with timely payments are factored in your favor. Conversely, recently established credit accounts or accounts with late payments are factored against you.


Curb bad credit habits and make a resolution to be fiscally responsible. Do so, and you will soon be ready to own a home in thriving South Florida. Steady job growth, stable economic times, and population expansion all make South Florida a fabulous place to call home. Marina Title is Florida’s premier Title Insurance and real estate closing service provider. Contact us today at (305)-901-5628 or to learn how we can help you own your new home.

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