Bad Credit Habits Walnut Creek, CA

Bad Credit Habits To Break In 2016

Don’t let these bad credit habits ruin your chances of buying a house.

When it comes to buying a house, your credit score is very important. If you are planning on buying a house this year, working on boosting your credit score should be at the top of your to-do list. Avoid these bad credit habits to get your finances where they need to be for the new year.

  • Now knowing how credit scoring works – if you use your credit card for all your purchases and then pay it off in full each month, you may think you are building up your score. However, you are not helping your credit utilization ratio, which makes up 30 percent of your score. Credit card companies report your balance at different times throughout the month, and if you are nearing your limit, your ratio doesn’t look so good.
  • Only looking at part of your credit – you should be looking at both your credit score and your credit report throughout the year. Even if your credit score shows that you are on the right track, your credit report could reveal discrepancies that could mean big trouble. At the very least, you should be ordering a free copy of your credit report at least once a year.
  • Avoiding all credit – if you have been avoiding establishing any kind of credit, you may be in trouble when it comes time to buy a house. Find a way that you can build up your credit, such as having just one credit card that you only use for a few regular purchases and then paying it off in full each month. Not having any credit can put you in the same boat as someone with bad credit when looking for a house.

For more tips on how to get your credit ready for homeownership and all of your home loan needs in Walnut Creek and all of California and Texas, contact Andraya Coulter.

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