Your credit report and credit score a core factor in qualifying for a home loan. Everyone should know what their credit score is and their credit history in detail. These are the guidelines I live by.
First and foremost you should check your credit annually (for free) at www.annualcreditreport.com THIS IS NOT A GIMMICK.
Dispute any transactions that you can, with all three credit bureaus (TransUnion, Equifax and Experian.)
This can be done online through the website.
BOOSTING AND MAINTAINING YOUR SCORE:
- Pay down credit cards so the balances are 50% or less than the maximum limit. Call the credit cards and ask for a limit increase to help meet that threshold.
- Maintain three active lines of credit or loans total
- Pay everything on time within 30 days or less of the due date
- Do not apply for credit! The more inquiries the more it negatively affects your score
CORRECTING ADVERSE CREDIT:
Work on paying these off! Get them off your credit! Call the agency and ask them to negotiate a payoff! A lot of times they will negotiate it at 50% of the balance or less to get payment.
Dispute these with the credit bureaus! Try to get the creditor to reverse the late payment if you can!
I realize that events are out of everyone's control and that sometimes bankruptcy is the only answer. That is OK! The key to bankrutpcies is that you re-establish credit afterwards and pay everything on time. No late payments! No collections! No way.
Keeping your credit healthy is a chore; but worth it in the long run and can save you tens and thousands of dollars!