Planning to shop for a home in a great community like Albany or Corvallis in 2024? The time that you invest in financial preparation now can pay dividends when it's time to get serious about shopping for a home, and improving your credit score is often a perfect place to start. Since your credit score plays a major role in the process of securing a mortgage and determining your budget, it's never too early to start working on improving it. Our real estate agents have some helpful, time-tested tips for improving your credit score when you're planning to purchase a home.

• Make Payments on Time
  Perhaps the single biggest factor in establishing (and improving) your credit score is making payments on time. If you haven't made payments on time in the past, now is the time to develop a sustainable budget that helps you build toward the goal of improving your credit score and purchasing a home.

• Consider Credit Utilization
  Another important factor in determining your credit score is your credit utilization, which is essentially how much of your credit limit that you use on any given card. A lower credit utilization is usually better for your credit score, and people with very strong credit often have utilization in the single digits of percentage points. Keeping your balance low and paying on time can help you improve your credit utilization over time.

• Opt for Higher Limits
  If a creditor is offering a higher limit with terms that work for you, opting for that higher limit can help you improve credit utilization, which in turn boosts your credit score. Utilizing that higher credit limit ultimately defeats the purpose, however, so this tip only works if you choose a higher limit while maintaining a similar or lower balance than you did in the past.

• Dispute Errors on Credit Reports
  It's not uncommon for errors to be present on credit reports, and those errors can have a direct impact on your credit score. The most common types of errors are on-time payments marked as late, credit activity on your report that doesn't actually belong to you, and negative information that's left on your report after it should have been removed. If you find these or any other types of errors, disputing them can help you improve your credit score.

• Resolve Past Due Accounts
  Of course, negative marks on a credit report can also be there for valid reasons, and in those cases, it's important to resolve old debts as soon as possible. This should be a top priority and one of your first goals when working to improve your credit. Once you've got your accounts up to date, it's essential to keep making payments on time.

• Avoid Opening New Accounts or Making Major Purchases on Credit
  Opening new lines of credit or taking out a loan for a major purchase like a car can cause issues with your credit score. So if you're thinking of applying for new credit cards or taking a loan, it's best to wait until after you've purchased a home. Fortunately, the work that you do now in improving your credit score for purchasing a home also has benefits when the time does come for opening new lines of credit in the future.

Choosing the right real estate agent is one of the best ways to simplify the home-buying process, and our local team would love to help you accomplish your real estate goals in 2024. Contact us to buy and sell homes throughout the Albany and Corvallis, OR area.