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\u201cThe first step in getting a mortgage, regardless of your credit score, is talking to an experienced and knowledgeable mortgage professional,\u201d explains Minneapolis residential and commercial mortgage expert Josh Manier. \u201cAfter pulling your credit report, that begins the process of finding a mortgage that will work for you right now or creating a plan so that you can qualify in the near future.\u201d Most lending professionals understand both how credit scores work and what lenders want to see both in terms of a score and in terms of the details of your actual credit situation. Like doctors, they\u2019ve also seen it all before, so you can be comfortable talking with them. \u201cAlthough your lender may give you a specific strategy, there are a few things you can start doing right now,\u201d adds Manier.<\/p>\n
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Your credit score weights recent activity more than older activity. One way to improve your score is to pay all of your bills on time going forward. Doing this will help to push your late payments back and show that you\u2019ve turned over a new leaf. If you have accounts on which you\u2019re late, finding the money to make them current will also improve your score. As you\u2019re doing this, remember that you probably won\u2019t have to get to a perfect score \u2013 many home buyers are able to get a mortgage with a score in the mid 600\u2019s.<\/p>\n
\u201cPaying down your balance helps in two ways,\u201d explains Manier. \u201cIt lowers the rate at which you use your credit cards, and it also reduces your total payment load and might let you qualify for a bigger mortgage.\u201d One big component of your credit score is your so-called utilization rate. Lenders like to see that you have credit available to you, but they also like to see that you’re not using very much of it. Given that carrying a balance can also be expensive given the high interest rates that many credit cards charge, it may even make sense to tap into your savings to pay your balance down. Ultimately, getting your utilization under 30 percent should help your score.<\/p>\n
Unless your mortgage lender advises you differently, you\u2019ll probably be best off if you avoid making any major changes to your credit. Closing accounts decreases the total amount of credit that you have available and has the unintended consequence of increasing your utilization and lowering your score. While opening a new account usually won\u2019t do a lot of damage to your score, opening multiples can be a sign that you\u2019re in trouble, and it can therefore make your score drop meaningfully. The one exception to this is if you don\u2019t have enough credit: \u201cSometimes, I advise some of my clients to increase their credit score by adding a new credit account and decreasing their overall utilization, but not usually,\u201d explains Manier. If you\u2019re in this situation, your lender should let you know, though.<\/p><\/p>\n","protected":false},"excerpt":{"rendered":"
Tip #1: Talk to an Expert \u201cThe first step in getting a mortgage, regardless of your credit score, is talking to an experienced and knowledgeable mortgage professional,\u201d explains Minneapolis residential and commercial mortgage expert Josh Manier. \u201cAfter pulling your credit report, that begins the process…<\/p>\n","protected":false},"author":17,"featured_media":1831,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_seopress_robots_primary_cat":"","_seopress_titles_title":"Got Bad Credit? 3 Finance Tips on How to Get a Home Loan | Quicken","_seopress_titles_desc":"Tip #1: Talk to an Expert","_seopress_robots_index":"","inline_featured_image":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1830","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized"],"acf":[],"jetpack_featured_media_url":"https:\/\/www.quicken.com\/blog\/wp-content\/uploads\/2022\/08\/83110692_XS_0.jpg","_links":{"self":[{"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/posts\/1830","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/users\/17"}],"replies":[{"embeddable":true,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/comments?post=1830"}],"version-history":[{"count":1,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/posts\/1830\/revisions"}],"predecessor-version":[{"id":1832,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/posts\/1830\/revisions\/1832"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/media\/1831"}],"wp:attachment":[{"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/media?parent=1830"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/categories?post=1830"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/tags?post=1830"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}