Buying a home makes your mind run a million different ways all at once.

There’s so much to consider and prepare for before you even find a lender or a real estate agent. But as you’re getting ready to finally apply for a home loan, you notice something terrible: your credit score needs some work.

Don’t let this information dampen your spirits!

Before you begin worrying that this will be difficult, rest assured that repairing your credit score can actually be simple.

All you need is to know where to begin. And the best place to start is at the source.

Starts Simply: look at your credit report

get your credit report
Building something usually starts with a foundation and then everything is built on top of that.

Your credit score is no different.

Whether you’re just starting out or your score needs some repair, the foundation of your credit score lies with the credit monitoring bureaus of:

  • Equifax
  • Experian
  • TransUnion

They exist in order to monitor your Fair, Isaac & Co. (FICO) credit score and maintain reports on it.

As a courtesy to the vast credit holding public, all three bureaus will each give you a free copy of your credit report when requested.

Additional copies may come at a charge, but for right now you should focus on those initial reports.

Once you have a copy (or three) of your credit report in hand, you can start searching it for information about what has damaged your credit score and what could be keeping it down.

A credit score can be seriously damaged by all of the following possibilities:

  • Late payments
  • Missed payments
  • Payments sent to a collections agent
  • Defaulting on a loan
  • Bankruptcy
  • Foreclosure
  • High credit balances
  • Credit balances that have been maxed out
  • Applying for multiple credit cards in a short period
  • Closing credit accounts

Wow.

That’s a pretty scary.

Your credit score is a delicate thing that can be damaged by even the slightest hit. However, damage to your credit score is not always your fault.

We also recommend checking your credit via www.annualcreditreport.com at least once a year. Pulling your credit report will help you ensure you’re not being unfairly penalized for old, paid or settled debts. If something is inaccurate, erroneous, incomplete or obsolete you can contact credit bureaus and creditors to have them remove these accounts from the credit bureaus.

Keep up with payments

keep up with payments so your credit score does not go down

The easiest way you can boost your credit score and keep it strong is by paying your bills on time.

Existing debt, credit card balances, and other monthly expenses are all viable factors that can affect your credit score (for better and worse).

Current debt and credit card balances are the major factors you need to take care of each month.

However, if you feel like or know that there’s a possibility that you’re going to be late on a payment, don’t just sit around. Contact whoever the payment has to go to and let them know the situation.

Many companies can be understanding if circumstances are difficult.

Keeping up with your monthly payments will help your credit score, but at a slow pace that takes time. Luckily, it’s not the only way you can boost your credit score.

Mange your credit cards

manage your credit cards
Here’s where many buyers and borrowers get in trouble when it comes to their credit score: responsible use of credit cards.

Credit cards can be helpful little things. (More info on credit repair.)

Actually, you don’t even have to limit yourself to one. Varied credit can be a sign to lenders that you can manage your finances efficiently and with little difficulty.

However, in order to get your credit cards to work for rather than against your credit score, there are a few things you’ll need to know.

The first thing is to keep the balances low.

No matter what the spending limit on any of your cards is, keeping the balance below 30% is absolutely key. It keeps your monthly payments smaller and your debt in control.

Additionally, please do not apply for any new credit before you apply for the mortgage. Opening new accounts will add additional debt to your credit which will change the length of your credit history and will add inquiries. All of these factors will work against your score and may prevent you from getting approved for your dream home.

Lastly, don’t close out credit accounts just because you don’t use them anymore.

Even if you have a card that you’ve paid off and no longer use, keep it open (unless you’re charged to keep it open).
Closing a credit account will also impact your credit score so it’s better to just keep it open for the time being.

Don’t Worry About It

dont worry about your credit
The best piece of advice about helping your credit score improve is to watch it but not obsess over it.

Hovering over your credit report and score doesn’t make it move any faster.

Instead of constantly fretting about your credit score, take some time and explore the other tasks you need to set about preparing for your home loan application.

As long as you stick to the advice from above, your credit score will take care of itself.

Keep an eye on it from time to time, of course, but don’t check it every day like you’re afraid it’s going to vanish. Stay on top of what needs to be taken care of and one day you’ll be looking at a strong credit score that will help you get a home loan.

A little boosting trick

boost your credit by 40 points prime credit advisors
“If you want to give yourself a little leg up on boosting your credit score, sometimes it makes sense to partner with someone with good credit.

The authorized user strategy is common for parents who want to help their children build credit. If someone from your family or a friend has established credit history and healthy habits that won’t backfire on you, you may want to request that they add you as an authorized user. By adding yourself to a well established card it might add up to 40 points to your credit.” – Tom Tarkowski of Prime Credit Advisors.

End Credits

Your credit score is one of the cornerstones of your home loan application.

If it needs a little boost before you find a lender, you know have a few tips to help you push it up a few points.

As you’ve seen, it’s not as difficult as most people would have you believe.

Keeping your credit score strong is important, but it never hurts to know a few ticks to make it even stronger.

And best of all these tips are always available to help your credit score along.