Before the Holidays - Remember your credit!

Before the Holiday Season is in full swing and the urge to run a lot of charges on your credit card takes over, it makes sense to see what credit means toward buying a home. Now, more than ever does credit matter when it comes to buying a home. We all know that the "best" credit risks get the "best" deals when it comes to financing, but that is true more than ever in this market. So here are some tips to help keep your credit in line.

• Remember to get a copy of your free credit report once a year. (You can request a copy here.)

More Tips...

1. Make your payment on time. (It seems like a no-brainer, but every time you are 30 days late, the credit bureaus will ding your credit report every time.)
2. Balance on Credit Cards should not exceed 30-35%. (i.e. If you have a $1000 max credit limit on your card you should keep the statement balance between $300-$350)
3. Pay-Off Debt - Don't move it around. (Those tricky credit card companies will send you those enticing offers to "transfer a balance for the low fee of 3% and a 0% APR for the first year", however this won't improve your credit. The bureau's system will see that you have simply moved the credit. Instead, start with the smallest credit card balance and work your way up to the largest.)
4. Don't close unused cards or open new cards not needed. (Some say to keep a small balance on your cards, however, if you have the card for a significant length of time, there is no need to use the card. Simply keep track of the cards so that you don't become a victim of fraudulent activity. Also, all new credit shows that you may be ready to make a new purchase and this will impact your score.)
5. # of Inquiries. (Those pesky credit card companies will "view" your credit so they can send you those wonderful offers. Though these "views" don't impact your credit, remember that consumer requested credit pulls can have a negative impact. Likewise when you don't pay a bill on time, the company you owe that holds the outstanding liability may check your credit and this can have an impact.)

Your credit is important and it is up to you to keep it healthy. A score of 718 vs. 741 can mean the difference in rate of up to .125 if not .250. Hopefully these tips will help you stay on track or get on track so that you can keep in mind the ultimate goal of owning your own home.