Credit Score Tips to Increase Buying Power
It is no secret that the better your credit history the better your interest rate will be purchasing cars, furniture or a home using a mortgage.
When getting a home mortgage you will be evaluated primarily by the Fair Isaac credit scoring system. This is a proprietary credit scoring system out of which comes scores associated with your history.
The reality is most people don't have the foggiest idea of the makings of their score. Most people think credit scoring is mainly about payment history.
Although a good on time history of payments is no doubt very important to a good credit score it is far from being the total picture. Other equally important factors play a role to complete the picture.
Since we started with payment history you should be aware that you're not late until thirty days post the due date. Keep that in mind when in a pinch. You pay all the way up til the end and still have a clean payment history.
Keep low balances relative to your available credit. If you keep a five dollar balance and you have $1,000 limit is better than a $5 balance and a $10 credit limit.
Along these lines avoid going all the way up to your limit on your plastic. Even with timely payments it signals trouble to your scores.
A lack of credit history typically works against credit scores. Do yourself a favor and get 2 or 3 slats of plastic. Start using them immediately and pay on time of course.
Do this in moderation. You don't want to go out and open a whole plethora of trade lines. This may be seen as a move to use a bunch of debt.
Use your credit cards to buy groceries once a month and then pay it off. Do that once a month for a year for two three cards and you'll have big scores in a year.
Lastly, if you do have derogatory marks try your best to make the blunder as far away from the home purchase as possible. The longer your derogatory marks season the better your scores get.
Most of credit scoring makes sense. Use logic when developing your credit picture and you'll be just fine.
When getting a home mortgage you will be evaluated primarily by the Fair Isaac credit scoring system. This is a proprietary credit scoring system out of which comes scores associated with your history.
The reality is most people don't have the foggiest idea of the makings of their score. Most people think credit scoring is mainly about payment history.
Although a good on time history of payments is no doubt very important to a good credit score it is far from being the total picture. Other equally important factors play a role to complete the picture.
Since we started with payment history you should be aware that you're not late until thirty days post the due date. Keep that in mind when in a pinch. You pay all the way up til the end and still have a clean payment history.
Keep low balances relative to your available credit. If you keep a five dollar balance and you have $1,000 limit is better than a $5 balance and a $10 credit limit.
Along these lines avoid going all the way up to your limit on your plastic. Even with timely payments it signals trouble to your scores.
A lack of credit history typically works against credit scores. Do yourself a favor and get 2 or 3 slats of plastic. Start using them immediately and pay on time of course.
Do this in moderation. You don't want to go out and open a whole plethora of trade lines. This may be seen as a move to use a bunch of debt.
Use your credit cards to buy groceries once a month and then pay it off. Do that once a month for a year for two three cards and you'll have big scores in a year.
Lastly, if you do have derogatory marks try your best to make the blunder as far away from the home purchase as possible. The longer your derogatory marks season the better your scores get.
Most of credit scoring makes sense. Use logic when developing your credit picture and you'll be just fine.
About the Author:
Near or far from Austin this is a great site for a home mortgage refinance calculator. Make sure you go there.
posted by Credit Counseling at
5:30 PM
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