Buying a home can be the most exciting time in a person’s life. However this excitement often comes crashing down due to a low or nonexistent credit score. Don’t get slapped with disappointment when shopping for a home. Follow these best practices for building strong credit.

  1. Pay on time.

This one is obvious; pay your bills on time! Not only is this a great habit to get into, but the major credit bureaus want to see a history of consistent and on time payments. Late payments are one of the most common reasons why people see drastic drops in their credit scores. This can be easily avoided. Some tips include:

  • Pay your bills as soon as they’re posted.
  • Set up automatic bill pay.
  • Register to pay a set amount each month on car or student loans.
  1. Apply for a credit card.

Applying for a credit card and using it (wisely) is probably the easiest way to build or repair credit. When searching for the right card try to find one with a low monthly interest rate, and no yearly membership fee. Also applying for a “major” credit card (Visa, MasterCard, American Express, and Discover) will help move your score up faster than applying through an independent vendor.

  1. Never max out your credit line.

Major credit bureaus want to know if you’re able to manage debt wisely. This means card holders should only be using around 30% of their given line of credit line. To help, try to use cash or debit, and only use credit periodically. This will help increase your score, and manage monthly debt.

  1. Pay off your debt off each month.

When using any form of credit, it is important to budget your expenses, and pay off any debt owed at the end of the month. This helps avoid paying interest and shows the credit bureaus you can manager your expenses. If you can’t payoff your entire bill, try to at least pay more than the minimum payment. Doing so will bring down the principle of what you owe faster.

  1. Plan ahead.

Establishing good credit doesn’t happen overnight. Homebuyers should plan ahead and be prepared. If you plan on buying a home, then now is the time to start managing debt responsibly and building credit. Doing so help prevent any surprises during the home buying process.

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Disclaimer: The McCue Mortgage company is not a credit counselor.