How to Improve Your Credit Score Before You Buy

Your credit score is one of the biggest factors in what mortgage you qualify for and what rate you'll pay. Even a modest bump can move you into a better pricing tier and lower your monthly payment. The best part: most of what drives your score is within your control. Here's how to strengthen it before you apply.

Know What Actually Moves Your Score

Your score is built from a handful of factors, and they don't carry equal weight. In rough order of impact:

• Payment history: whether you pay on time. This is the single largest factor.
• Credit utilization: how much of your available credit you're using.
• Length of credit history: how long your accounts have been open.
• New credit: recent applications and hard inquiries.
• Credit mix: the variety of account types you carry.

Focus your energy where it counts most: paying on time and keeping balances low.

Pay Every Bill on Time

Nothing helps or hurts your score more than payment history. A single missed payment can drop your score significantly and stay on your report for years. Set up autopay or reminders so nothing slips through, and if you've had late payments in the past, know that the damage fades as you build a clean, consistent track record.

Lower Your Credit Utilization

Utilization is the percentage of your available credit you're using, and it's one of the fastest levers you can pull. Aim to keep balances under 30% of each card's limit, and under 10% is even better.

A few ways to bring it down:

• Pay balances down ahead of your statement closing date, not just the due date, since the balance reported to the bureaus is usually the statement balance.
• Spread balances out rather than maxing one card, even if the total is the same.
• Ask for a credit limit increase on an existing card. A higher limit lowers your utilization without you paying anything, as long as you don't add new spending.

Don't Close Old Accounts

It's tempting to close a card you don't use, but that can backfire. Closing an account lowers your total available credit (raising your utilization) and can shorten your average credit history. Unless a card carries an annual fee that isn't worth it, keep your old accounts open and use them occasionally to keep them active.

Limit New Credit Applications

Every time you apply for new credit, a hard inquiry can ding your score a few points, and several in a short span add up. In the months before you buy a home, avoid opening new accounts: no new cards, financing offers, or loans. This is also critical during your loan process, since new credit can jeopardize your approval.

Check Your Reports for Errors

Credit report errors are more common than people expect, and they can quietly hold your score down. You're entitled to free reports from all three bureaus at AnnualCreditReport.com. Review them for accounts that aren't yours, incorrect balances, or payments marked late that were on time, and dispute anything that's wrong. Correcting a single error can sometimes move your score meaningfully.

The Mortgage-Specific Angle

A couple of things worth knowing when you're buying a home:

• Lenders use your middle score. With three bureau scores, the lender takes the middle one, and for two borrowers, often the lower of the two middle scores. That means it helps for both applicants to be in good shape.
• Rapid rescoring exists. If you pay down a balance or clear up an error while under contract, we can sometimes have your credit updated quickly rather than waiting a full cycle, which can be the difference in qualifying or hitting a better rate tier.

Start Early

Credit improvement takes time, so the earlier you start, the better. Even a few months of on-time payments and lower balances can produce a real change. If you're thinking about buying, the smartest first step is to have your credit reviewed now. That way there's time to make small moves that pay off when it counts.

---

Want to know exactly where your credit stands and what would move the needle before you buy? Let's pull it together and build a simple plan tailored to your situation. For the basics, see our guide to credit and your mortgage.