Expert Insight of the Week:

From Credit Zero to Homeowner Hero: 5 Tips to Boost Your Score Fast

Buying a home is a major milestone, but your credit score can make or break your ability to qualify for a mortgage with favorable terms. Lenders typically require a minimum credit score of 650 for conventional loans. If your score needs a boost, here are five proven strategies to help you improve your credit score and get mortgage-ready.

1. Pay All Bills On Time

Your payment history is the single most important factor in your credit score, accounting for about 35% of your FICO® Score. Even one late payment can significantly lower your score and remain on your report for up to seven years.

• Set up automatic payments or calendar reminders to avoid missed due dates.
• If you’re struggling, at least make the minimum payment to keep your account in good standing.
• Consider using tools like Experian Boost, which can add eligible utility and streaming payments to your credit file and potentially give your score a quick lift.

2. Reduce Your Credit Card Balances

The amount you owe—especially on revolving accounts like credit cards—makes up about 30% of your credit score. This is known as your credit utilization rate, which is the percentage of your available credit you’re currently using.

• Aim to keep your utilization below 30%, but lower is better.
• Pay down high balances as quickly as possible, focusing on cards with the highest interest rates first.
• Consider making multiple payments throughout the month to keep your reported balances low.
• Avoid maxing out your cards, as high utilization can quickly drag your score down.

3. Review Your Credit Reports and Dispute Errors

Mistakes on your credit report can unfairly lower your score. Common errors include incorrect late payments, accounts that don’t belong to you, or outdated negative information.

• Get free copies of your credit reports from Experian, Equifax, and TransUnion at least once a year.
• Carefully review each report for inaccuracies or signs of identity theft.
• Dispute any errors promptly with the credit bureau; correcting mistakes can quickly improve your score.

4. Avoid Opening or Closing Credit Accounts Unnecessarily

Each time you apply for new credit, a hard inquiry appears on your report, which can temporarily lower your score. Similarly, closing old accounts can reduce your total available credit and shorten your credit history, both of which may hurt your score.

• Only apply for new credit when absolutely necessary.
• Keep older credit accounts open, even if you don’t use them often, to maintain a longer average credit history and higher total credit limit.
• If you’re new to credit or rebuilding, consider a secured credit card to establish positive payment history without taking on excessive risk.

5. Diversify Your Credit Mix

Lenders like to see that you can manage different types of credit responsibly, such as credit cards, installment loans, and retail accounts. Having a healthy mix can slightly boost your score, especially if you mostly have one type of credit.

• Don’t take out loans you don’t need, but if you only have credit cards, an installment loan (like a car loan or personal loan) can help diversify your profile.
• Make sure you can comfortably manage any new accounts before opening them to avoid missed payments or increased debt.

Improving your credit score takes time and discipline, but the effort pays off when you’re ready to buy a home. By paying bills on time, reducing debt, monitoring your credit reports, managing accounts wisely, and diversifying your credit, you’ll not only qualify for a mortgage but also secure better interest rates and terms. Start these steps today, and you’ll be well on your way to turning your homeownership dreams into reality.

$87.00 eBook - How to Buy an Investment Property in Jamaica Your step-by-step guide to finding, purchasing and managing an investment property in Jamaica Who is this for?... Read more Get my eBook!

​

Learn more in the below video:

​

​

See you next week!

Stay Blessed, Jess Martin @ SideHustleMama​ Email: jess@sidehustlemama.co​ WhatsApp: +1 (631) 449-6481 Global Investor Agent | Real Estate Consultant | CIPS Powered by eXp Realty - Atlanta, GA