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A home mortgage is one of the most significant loans you will likely ever get in your life. You will likely pay well over $100,000 for your home (or even two or three times that), and you will likely be paying it back for the next 30 years. Finding the absolute best rates that you can on your mortgage can help you to save thousands of dollars over the life of your loan — not only to save you money but to maximize the return on your investment when you sell the house, click here for more loan information.

There are a number of ways that you can improve your credit score in order to get the best terms on your mortgage. Here are a few tips:


Pay Down Your Debt

Your overall debt-to-income ratio has a significant impact on your credit score. Before you start shopping for a mortgage, you need to do everything you can to pay down your mortgage as much as possible. Ideally, your debt-to-income ratio should be zero, though most lenders will allow a debt-to-income ratio of up to 40 percent. The lower it is, the better your credit score will be and the better your loan terms will be.


Clear Off Delinquencies

Of course, paying all your bills on time is the best way to keep your credit score as low as possible. However, things happen that may cause you to miss a bill and to cause you to get a negative mark on your credit report. If this happens, be sure to pay it as soon as you can. Those delinquencies will continue to bring down your score for as long as they are on your report. Make sure you pay off any delinquencies appearing on your report before you start applying for home mortgages so that your score is the best it can be and you get the best terms that you can.


Build a Good Credit History

No matter how many issues you may have experienced with your credit in the past, you can start building up your score at any point by building up a good credit history. For whatever accounts you currently maintain, make sure that you always pay the amount due on the due date. Also be sure that you keep your overall balances to a low level. If you don’t have any credit now, apply for a secured credit card or a small card such as a department store credit card or a gas credit card with a low limit. Once you’re approved for one of those, make sure you always pay the amount that’s due on the due date.

Taking care of your credit can help you to get the absolute best rates on your mortgage so that you save money and can better manage your finances. You can learn how to calculate your mortgage here so you can better understand what your monthly payments will look like based on the terms that you expect to get. To learn more about finding a great loan, click here.