Improving Credit Score

malittamay · June 2012

I know my credit score isn't the best, but I am wanting to buy a home in the near-ish future (though we are wanting to buy something SUPER cheap so we can fix it up over time), so I didn't know how long it would take to improve my score, and what would be the best approach.

MommyLiberty5013 · June 2012

Building up credit takes time. And, it's not all about the score. It's about the credit report and what it details (ages of accounts, payment histories, judgements, liens, charge-offs, balances owed compared with credit limits on CCs, etc.).

Pretty much all negative things on a credit report stick on there for 7-10 years. This doesn' t mean you cannot get a loan for a home. However, it might mean it will be more difficult and/or that you would have more stipulations and possibly a higher interest rate.

Where are you starting from? What do you have open and active now? What are your negative things?

The biggest thing to fixing credit is to get all of your payments on time. On CCs get them paid down to where they are not near or remotely close to being maxed out. You should also get your credit reports (Equifax, Experian, and Transunion) and verify that you don't have any errors. Federal law stipulates that each person is entitled to one free credit report (not scores) from each of the three bureaus per year.

Sisugal · June 2012

Pay everything ON TIME. Pay off consumer debt - or no more than 15% of allowable limmits. If you plan on a fixer - have the cash in hand to do those projects - do NOT put it on credit cards!

Have an emergency fund in place (6 month's expenses)

Put 20% down

Show you have financial stability

GeorgiaRiah · June 2012

I just kept paying everything down throughout the home buying process. My score went up 30 points over 6 months but I did not have any collections just credit cards. Good Luck!

SCBride2007 · June 2012

Two or three posts intoy blog, I put my story on how I raised my credit score. Mine started in the 400s... It was awful. Anyway, my way may not work for everyone, but it worked for me. Blog in siggy. I'd link it, but I'm on my phone.

malittamay · June 2012

I have some late payments on some of my accounts, but not all....and I am actually going to be able to pay off one of my 3 high interest CC's this month, hopefully in the long term freeing up more money to put towards the other CC's. I do have a very good work history however. All of this has been something I have been trying very hard to keep up with (you can ask my fiance how stressed I've been to try to make payments on time, especially since he has been out of work for about 3 months). My credit may not be as bad as I am thinking, or it could be worse who knows, I just don't want to be shocked when we try to get pre-approved for a home loan, and I don't want to get the credit report quiet yet because I don't want to hurt my score even more by requesting the report....just stressed I guess....

GeorgiaRiah · June 2012

I think late payments might hurt you. If you have a hard time paying the credit cards on time then you are going to have a really hard time with a house and all the emergencies and fixes that come along with it. My loan agent advised not to pay the cards completely off while house hunting even if you are just leaving like 5 bucks on them. Try and get everything under 10% of what the limit is. For example if your limit is $1000 try and pay it under $100. Leaving a balance even if it's 5 dollars will show the account as open and in use so they count it in. That is the advise my mortgage broker gave me. Good luck with your house hunt.

Boxx123 · July 2012

I think it is okay if you have a not so good credit score . I think you can still buy a house.

Improving Credit Score

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