Increasing Credit Scores

By
Real Estate Agent with Keller Williams Realty SunCoast

Many times Buyers need to increase their Credit Score before purchasing a home.
Below are five simple methods that can help  ......

1. Know your credit score and what's on the credit report.  Remember to get a copy of the three major reports because information on each one can differ.

2. Pay bills on time!  Even paying 30 days late a few times a year can have a serious negative impact on your credit score. Late payments can stay on the credit report for up to two years.

3.  Increase the limits on your credit cards.  This is probably the fastest way to improve your score and can often be done over the phone.

4. Maintain a low total debt load percentage.   Keeping your total debt to approximately 20 - 25 percent of your credit card limit.

5. "Repair" negative items on your credit report.   Write a letter to credit reporting agencies to dispute negative aspects of your credit report, late payments etc.  The agencies must address anything you report immediately and if they cannot verify the information in 30 days, it must be removed from the report.

These tips will improve a credit score drastically and help you obtain better financing terms when it comes time to make an offer.

Good luck!

Comments (18)

HomeSalesForce.com Team Brokered by eXp Realty
eXp Realty - Canton, GA
Canton, Alpharetta, Roswell, Woodstock, Atlanta

Great ideas. I always tell my buyers to check their scores on the TRUELY free annualcreditreport.com site. In GA we can get our twice each year for all three bureaus.

Aug 15, 2008 03:23 AM
Steve Laird
Anderson Real Estate Sales - Chico, CA
Steve Sells Chico Real Estate

Good info!  Alot of the new home builders today are offering credit workshops to help increase credit scores.

Aug 15, 2008 03:24 AM
Mike Frazier
Carousel Realty of Dyer County - Dyersburg, TN
Northwest Tennessee Realtor

Carole,

thanks for the advice. I will pass along to my clients sitting on the credit fence unable to purchase!

Aug 15, 2008 03:25 AM
Carey Pott
January Financial - Foothill Ranch, CA

#5 is particularly important, since most consumers don't know that there's a lot they can do to fix up negative items on their reports. Thank goodness we're here to help! :)

Aug 15, 2008 03:35 AM
Shana Wilson
Keller Williams Westbank - Gretna, LA

This is GREAT information...I have lots of buyers trying to buy houses but scores are just below qualifying.

Aug 15, 2008 03:46 AM
Karl Peidl
Moorestown, NJ
Accredited Loan Consultant

Regarding #5... It can actually hurt your credit score if you payoff a derogatory account that is more than two years old.  When it comes to your credit, time heals all wounds.  By disputing or paying an old derogatory account, the activity on that account becomes more recent, thus having a negative impact on your credit score. 

I offer a Credit Scoring Booklet as well as weekly emailed credit tips to anyone with credit issues.  I'd be happy to offer these services to anyone here who think they or their clients could benefit.

Aug 15, 2008 03:51 AM
Carole Lhuillier
Keller Williams Realty SunCoast - Saint Pete Beach, FL
Our Home Team SunCoast

Karl, I wasn't thinking about actually paying off a derogatory account that was that old, but rather more recent dings on the report.  Would love to see the credit scoring booklet.

Thanks,

Carole

Aug 19, 2008 02:45 AM
Karl Peidl
Moorestown, NJ
Accredited Loan Consultant

Carole, I mail you a booklet today.

Aug 19, 2008 03:11 AM
Carole Lhuillier
Keller Williams Realty SunCoast - Saint Pete Beach, FL
Our Home Team SunCoast

Thanks so much.  I will watch for it and appreciate you sharing this information.

Carole

Aug 19, 2008 03:23 AM
Karl Peidl
Moorestown, NJ
Accredited Loan Consultant

My pleasure.  Sharing knowledge and helping each other is what I believe makes AR so great.

Aug 21, 2008 01:38 AM
Carole Lhuillier
Keller Williams Realty SunCoast - Saint Pete Beach, FL
Our Home Team SunCoast

Karl, I agree with you.  It is amazing to me the wealth of knowledge you find at AR if you just pursue it.  And...isn't it great that everyone seems so willing to share with others.

Aug 21, 2008 03:50 AM
Karl Peidl
Moorestown, NJ
Accredited Loan Consultant

Hey Carole - I hope you had a great weekend.  Did you get the credit scoring booklet I sent yet?

Aug 25, 2008 02:38 AM
Carole Lhuillier
Keller Williams Realty SunCoast - Saint Pete Beach, FL
Our Home Team SunCoast

Carl, actually I did not.  I assume that you mailed it to my office address.  Did you use the one in metro Atlanta or the one in Florida?

Let me know and I will double check.  Thanks again for your efforts.

Aug 25, 2008 09:36 AM
Karl Peidl
Moorestown, NJ
Accredited Loan Consultant

I mailed it to the Atlanta office.  Did you have a different address that you'd like me to send another one to?

Aug 27, 2008 01:39 AM
Jon Wnoroski
America's 1st Choice RH Realty Co., Inc. - Green, OH
Summit County Realtor

Good information.  Buyers can use this information .. I'll pass it on.

Aug 27, 2008 02:27 AM
Carole Lhuillier
Keller Williams Realty SunCoast - Saint Pete Beach, FL
Our Home Team SunCoast

Thanks so much, Jon.  Everyone can use this kind of help in our current situation.

Oct 02, 2008 08:18 AM
Linda Breeding
Keller Williams Realty - Pinehurst, NC

Great information Carole, I can add one, don't go after teaser rate cards and switch balances. This can have a negative impact on your score. Also, don't close credit card accounts that you have had for a long time (even if they have zero balances). The longer you hold an account the better it helps your score. So this switching cards for a lower rate is a no-no for your score.

 

 

Oct 02, 2008 09:27 AM
Carole Lhuillier
Keller Williams Realty SunCoast - Saint Pete Beach, FL
Our Home Team SunCoast

Linda, yes, very good points.  Thanks for your response and good luck to you.

Oct 03, 2008 02:02 AM