3 Secrets To A Better Credit Score To Buy A Home In Thomasville Georgia

How To Get A Better Credit Score To Buy A Home This Year

 

Did you know that 35% of your credit score is from your Payment History. Here are 3 Secrets To A Better Credit Score To Buy A Home In Thomasville Georgia.

Secret  #1. Pay on time! It doesn’t get any simpler.

Secret #2 Thirty Percent of your credit score is based upon the Capacity of credit. For example, if you have a credit limit of $5,000 you only want to use 30% of the capacity of that card.  Meaning, you only want to use $1,500 of credit and keep $3,500 that is unused. So here’s a tip, if you have one credit card with a $10,000 balance and another with a much lower balance, transfer some of the debt from one credit card to the other so that the capacity used is as close to 30% as possible.

Secret # 3 is that 10% Of your credit score is based on Inquiries and Past Applications, so keep in mind that 75% of your Total credit score is based upon Payment History, Capacity of Credit Used, Inquiries and Past Applications. So you want to be VERY mindful of that. So pay your bills on time, be sure not to max out your cards, keep a 30% balance or lower and don’t get too many inquiries and that alone will help dramatically maximize your credit score.

Don’t mistake a Charge off of debt to mean that you no longer owe any money on that debt.  A charge off is when a creditor writes off a balance that you owe, but have not paid off. They write it off their books or “Charge It Off.”  This does NOT mean that you no longer owe it. It becomes a COLLECTION when the account is sold to a Third Party called a Collection Agency. So be carefully, charge off is NOT I don’t owe, you still do.

So should you Settle an Account of Do a Payment Plan?  1st. Consider the age of the account when you decide if you want to settle the account or establish a payment plan.  Lenders just want to see that you have the responsibility of dealing with it. They do NOT care if you settle for pennies on the dollar or in full.  If you do a settlement, obtain a letter stating the TERMS prior to making the settlement. Remember, this doesn’t make sense, but regardless of which option that you choose, initially your credit score will GO DOWN until you either settle the account or complete the payment play.  Disclaimer, If you are looking to purchase a home, consult a lender PRIOR to repairing your credit or making any decisions. Sometimes things that you think might make sense to do, may actually have a negative effect on your credit.

For more detailed information about how to maximize your credit so that you can save money and get better interest rates, reach out to me at any time or click to link below to get a detailed Credit Report Guide. Thanks again and as always!

 

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