Check Your Credit Score Before Buying A Home

Check Your Credit Score Before Buying A Home

Why is it important to check your credit score when buying a home?  When you approach a bank  or mortgage lender for a loan, your credit history will be used to determine if you will be a responsible borrower.  Lenders learn about your credit history by looking at your credit report.  Your credit scores will then determine the rate and conditions you receive on a loan.

If your score is high, meaning your credit history shows that you've paid your credit bills on time, haven't maxed out your credit cards, then lenders think you will be able to pay your loan.  They will see you as a low risk and offer you a low rate on your loan with good conditions.

If your score is lower, lenders will think you're a riskier investment and charge you by loaning money at a higher interest rate, often with hidden charges, in order to take on the perceived risk.

The maximum credit score is 850, however any score in the 700's is excellent and will get you a loan with the lowest rate.  A score in the high 600's is still considered good, lower than that canbe a problem.  So you can see the importance of keeping a good score.

The good news is that your score is not fixed in stone.  If you have low credit scores, there are ways to improve your credit health and a reputable lender can give you advice on making those improvements.

You can check your credit score using Credit.com's  free Credit Report Card.  You can get yor scores from three agencies:  Equifax, Experian, and TransUnion.  This free tool will show  payment history, debt and other factors affecting your score and you'll get recommendations for steps you can consider to address problems.  Checking your own credit does not affect your credit score in any way.


Margaret Laurano Headshot
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Phone: 201-859-6323
Dated: January 18th 2016
Views: 546
About Margaret: Margaret has over 30 years of experience with a background in commercial real estate which gives her...

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