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Monday, February 27, 2023   /   by Ameil Gill


If you’re considering buying. a home, it’s important to understand your credit score and credit report, because well, the better your credit score, the better your interest rate.

The two most important factors that determine your credit score, according to major credit scoring companies, are payment history and credit utilization.

?? Payment history. 
Pay all bills on time! Paying bills late by 30 days or more can affect your scores — and the later you pay, the greater the damage. Pro tip: set up autopay or calendar reminders so you don’t miss due dates, or pay all of your bills and credit cards on the 1st of every month. You can also ask creditors to move your due dates so that they better align with when you get paid.

?? Credit utilization. 
The amount of your credit limit you use, expressed as a percentage, is called credit utilization. Experts recommend using no more than 30% of your available credit.

Other factors that affect your credit score are

• The length of time you have had credit — longer is better.
• The length of time since you last had your credit run or applied for new credit.
• The kinds of credit you have — this includes credit cards, car loans, and mortgages (it’s favorable to have a mix).

Have questions about the mortgage process or other factors that influence getting pre-approved? Send me a message — I’d be happy to answer any questions or put you in touch with one of my trusted lenders.