What is my credit score in Ohio and how will it determine my savings?
When you are buying a home in Ohio, your credit score is a crucial number that will determine the savings, if any, you receive when getting your loan. The interest rate you will pay for the money you borrow is mainly determined by your credit score that is generated from the information found in your credit report.
Most lenders in Ohio have rules on giving out the best interest rate and terms, and those rules almost always place a major emphasis on your credit score. For example, if the best interest rates are offered to borrowers in Ohio with a score of 750 or higher and yours is a 748, those 2 points could cost you hundreds, if not thousands of dollars.
According to www.myfico.com, the consumer Web site of the Fair Isaac Corp. that created the FICO score (the most commonly used credit score), the interest rate difference between those two scores is one-half percentage point. On a $165,000 30-year fixed rate mortgage, that half point could cost you more than $19,000 in interest charges, assuming 6 percent is the lowest rate available.
Improve your credit score in Ohio quickly:
There are steps you can take to improve your credit score in Ohio. A number of variables play into an individual credit score, but the best credit scores are generated by paying your bills on time, keeping account balances low and taking out new credit lines only when needed.
Look for errors in the credit report, such as accounts that aren't yours, late payments that were actually paid on time, debts you paid off that are shown as outstanding or old debts that should not be reported at all. Then, fix the errors with the credit reporting agencies.
After you fix the errors, the fastest way to improve your credit score in Ohio is by paying down balances on credit cards. It may be possible to improve your credit score by paying down your credit cards. NOTE: Typically, closing unused accounts won't affect your credit score either way.
Leave the oldest credit cards open. If you close the account of the credit card you opened when you were a freshman in college and leave the credit cards you just received within the last couple of years open, you are made to look like a "newer" borrower.
One more tip: Transfer balances from a credit card that is close to it's limit over to other credit cards to even out your usage. If you aren't able to do this, or this isn't applicable to you, try spreading out your charges between a few credit cards.
The tips above are just a few ways to improve your credit score in Ohio.
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