Credit Myths, Mistakes & Misconceptions

If you have good credit, the following tips will help you keep it that way. If you are looking to improve your credit, now is the time to get started!

Don’t Fall Behind on Existing Accounts

One 30-day late can cost you anywhere from 30 to 80 points or more on your credit score.

Don’t Pay Off Old Collections or Charge-Offs During the Loan Process

Paying collections will decrease your credit score immediately due to the “date of last activity” becoming recent. Consult your mortgage advisor for recommendations on paying these accounts off.

Don’t Close Credit Card Accounts

Closing accounts can affect many factors of your score, such as the length of your credit history.

Don’t Max Out or Overcharge Credit Accounts

This is the fastest way to bring an immediate drop of 50-100 points in your credit score. Try to keep credit card balances below 30% of the credit limit.

Don’t Consolidate Your Debt Onto 1 or 2 Credit Cards

It seems like the smart thing to do, however, when you consolidate all debt onto one card, it appears you are maxed out on that card and the system will penalize you as mentioned above.

At LoanCentral we work together with you to get your credit in the best shape possible for your upcoming mortgage. Give us a call to review your credit and find out exactly where you stand.

~ Courtesy of Wendy Charles, LoanCentral LLC, 425.468.9321, WendyC@LoanCentral.com