How to Improve Your Credit Score Before Buying a Home

How to Improve Your Credit Score Before Buying a Home

When it comes to buying a home, there is much to think about. In fact, house buying is classed as one of the most stressful things one could do. You will need to save up for a down payment, be sure that your bank statement is in decent shape, contact a real estate agent, find a home, and then go through the entire process of applying for a mortgage. According to the folk at EXIT Real Estate Consultants (, house buyers can often become quite stressed during the process. But one piece of advice that they have, particularly for first time buyers, is to improve their credit score before applying for a mortgage.

Why Do You Need a Good Credit Score to Buy a Home?

If you are a cash buyer, then you don’t need to worry about credit score. Let’s face it though, most of us do not have the cash to pay for a house purchase. This means that your only option is to get a loan from a bank or other lender. A loan for a house purchase is called a mortgage, and to secure a good interest rate and other favorable terms you are going to need an excellent credit score.

But what happens if your credit score is not looking so healthy right now? Is there a way to improve it?

Improving Your Credit Score

Fortunately, you can raise your credit score before applying for a mortgage. The first thing to do is to look at your credit score and the reports held by the three main credit bureaus, Experian, TransUnion, and Equifax. You can check your report for free, so it is worth doing this to make sure that the information held about you is accurate. If your score is low, the credit bureau will usually explain the reasons for this. For example, it may be that you are utilizing too much of your available credit, or it could be that you have some missed or late payments on one or more of your credit accounts.

Your score will improve if you are using less than 30% of your available credit, so work on paying off credit cards to bring this credit utilization down. Make sure you are not late paying any of your bills as this can have an enormous impact on your score as well.

If you have checked your report and can see that your credit utilization is low and you don’t have any late payments and yet your credit score is still low, you will need to do some detective work. If there is nothing glaringly obvious as to why your score is low, check to see if you are financially connected to anyone else as this could be bringing your score down. For example, you may still have a financial link to an ex-partner, or perhaps you opened a shared account with fellow renters in the past. If you have any of these links, contact the credit bureau and ask for the links to be broken. This can have a positive impact on your score.


When getting ready to buy a home, there is plenty to think about. However, having an excellent credit score will mean that you are likely to be able to access the best interest rates and may be eligible to apply for mortgages with a lower down payment too. There are many ways to improve your credit score such as reducing your debt, paying your bills on time, and severing any old financial links. Doing this will make buying a home much easier.

Tereso sobo

The author Tereso sobo