There are many benefits to choosing an experienced local realtor. They know the area in and out, understand how the market fluctuates, can help guide you to the perfect home for you, and can help you understand all the jargon and terminology associated with buying a home. They can also give insight into the financial side of your journey, including improving your credit.
Your credit affects more than just the amount a bank is willing to lend you for a mortgage; your interest rate and credibility are tied to that all-important number. What if your credit score could be better? What could you do to improve it?
A credit score works by showing lenders your ratio of debt to credit. There are several ways you can improve this number to lower your interest rate or increase your loan amount. Your realtor and financial advisors can help guide you on what’s best for you, but we’d like to share some general ideas here.
In general, lowering your debt will improve your score. Keep a close watch on your credit card balances. By paying off your credit card each month, your debt to credit ratio will improve. By having less debt and more credit, you’re demonstrating that you’re responsible with lines of credit. It’s important to keep in mind that credit rating bureaus take into account the amount on the credit card statement; sometimes paying multiple payments per month may improve your score as well.
Another small improvement is to pay off all of the small balances you have across multiple cards. Credit rating bureaus analyze how many of your cards have balances. By using only one card for new purchases, you can improve your credit health.
Don’t rush to remove paid off items from your report. Good debt that was paid in a timely fashion shows you use credit responsibly. If your mortgage or car is paid off, you don’t need to remove it from your credit report. It actually helps your score. The longer your history of good debt, the better your overall score is.
It may seem like common sense, but paying all of your bills on time is essential for having a healthy credit rating. More common sense? Keep a close eye on your credit. You can receive three free credit reports each year. If you order one every four months, you can protect your identity, monitor your credit, and verify all the accounts on your report are actually yours. Even big companies make mistakes.
When you’re ready to begin your home search, the realtors here at Jane Terrell can not only guide you to the perfect home, but through every step along the way to finding it. Whether you’re aiming for Gatlinburg, Pigeon Forge, or Sevierville, we’ll help make your Smoky Mountain dreams come true. From distressed homes to cabins to dream houses, we can show you all our beautiful region has to offer.