813.910.8020 Apply Now

Mortgage Broker Tampa, FL | Mortgage Lender Tampa Florida | Marimark Mortgage

  • Home
  • Homebuyers
  • Homeowners
  • Realtors
  • Investors
  • About Marimark
  • Contact Us
  • Mortgages
  • Apply Now
  • Current Mortgage Rates
  • Calculators
  • Testimonials
  • Blog
  • Videos
  • Featured In
Home / Blog / Credit Scores / 5 Easy Steps to Improve Your Credit Scores

5 Easy Steps to Improve Your Credit Scores

March 25, 2014 By Mary Catchur

Your credit score and your mortgage

Although we don’t specialize in credit score reporting issues, there are circumstances that we may be able to assist our borrowers with during the loan pre-approval process.  In many cases, when we look at credit reports in order to pre-approve a borrower, we are not only looking at credit scores, but also at the components of credit, how the borrower utilizes credit currently and how they have used it in the past. There are often things we can recommend that they can increase their scores or better prepare them to begin the mortgage process that can be accomplished in a short time.

Most borrowers will have credit scores from three bureaus – Experian, Trans Union and Equifax.  The lender will utilize a report which shows all three credit scores of the borrowers.  The score they will use is the middle score. If there are two borrowers they will determine the middle score of each borrower and use the lower of the two scores.

#1 Use Credit

One of the most common mistakes we see is borrowers who do not utilize credit.  In some cases, this is because they have gotten into trouble in the past with credit issues and possibly experienced a bankruptcy.  Many people who have had such issues decide that the best way to avoid future problems is to avoid using credit.  While that will ensure that you don’t run into problems, it may make it difficult to obtain credit when you decide you would like to buy a home.

The best way to demonstrate that you use credit responsibly is to have a variety of different types of credit, pay your bills in a timely manner, and keep balances relatively low in relation to your credit limits.

#2 Use Different Types of Credit

One of the things that can help to improve a credit score is to have a variety of types of credit.  In other words, installment loans such as auto loans and mortgages; and revolving credit such as bank/nonbank/retail store/gas credit cards.  Most credit experts recommend that you have a diverse mix of these credit sources.

#3 Pay Your Bills in a Timely Manner

One of the things that can hurt your credit more than anything is late payments, particularly when they are recent. I have seen too many instances in which a borrower neglected to make a payment on an account between the time they were pre-approved and the time they found their dream home. Unfortunately in the majority of these cases, the score dropped so significantly that the borrower was unable to pursue their home purchase. While it is not necessary to completely pay off credit card balances each month, minimum monthly payments must be made to preserve your credit scores. Many people also neglect to pay medical bills that they believe are the responsibility of their health insurer. Medical bills that go into collections will damage your credit.

#4 Keep Balances Relatively Low in Relation to Credit Limits

This relates to your revolving credit accounts which have a credit limit.  The best way to manage your credit is to be aware of your credit limits and make sure that the balances on your revolving accounts are low in relation to the allowed limit.  This is referred to as “credit utilization” and is calculated by adding up the balances on all of the revolving credit accounts and dividing it by the credit limit on all revolving accounts.  The lower the utilization percentage is, the better your score will be.  That is why it is often recommended that you do not close out revolving accounts that are not used, as that will reduce the total credit available and thus increase the credit utilization percentage.

#5 Check Your Credit at Least Annually

If you keep the above general guidelines in mind while preparing yourself to purchase a home, you should be ready when the time comes to buy.  It is a good idea to check your credit at least annually to make sure that there are not errors or items you were not aware of.  You are entitled by law to receive a free credit report once each year.  The official site to obtain your credit report is AnnualCreditReport.com.  Beware of other sites which may offer free credit reports as many of them offer free reports in an attempt to sell other products and services.

Opt In Image
Stay Informed, It's Your Money
Marimark Mortgage Newsletter

The Marimark Mortgage Newsletter will keep you informed with important events in the mortgage industry that could impact your finances.

We especially focus on ways to save money on your current and future mortgages. And, we continually share the information we share with our clients, because we believe informed consumers are the best consumers.

Real estate agents, and other professionals in the industry, will receive an ongoing wealth of information that will help them serve their clients.

Thank you for signing up!

Filed Under: Credit Scores Tagged With: credit reports, credit scores

Opinions, estimates, forecasts and other views contained in this page do not necessarily represent the views of Marimark Mortgage or its management and should not be construed as an offer to provide financing at the rates or terms mentioned. Due to market fluctuations, interest rates are subject to change at any time and without notice. Interest rates are also subject to credit and property approval. Although Marimark Mortgage attempts to provide reliable, useful information, it does not guarantee that the information is accurate, current or suitable for any particular purpose. Information from this page may be used with proper attribution.

Save with a Mortgage from Marimark

Whether you are buying a home or refinancing, you can save with a mortgage from Marimark Mortgage!

    Search

    Post Categories

    Testimonials

    Refinancing with Mary an absolute pleasure

     
    Refinancing with Mary has been an absolute pleasure. I have never been through the process before and she took the time to explain each step. She was prompt (had a rate locked in right away) and most importantly always answered the phone or emails almost immediately! The communication line alone made the refinancing process every bit worth it. Would recommend to anyone, and will be back for any future purchases! Bret Brennan, March 2021
    See More Reviews
    Marimark Mortgage LLC
    5327 Primrose Lake Circle
    Tampa, FL 33647-1328
    (813) 910-8020
    (866) 910-8020

    Accessibility
    Privacy Policy
    Terms of Service
    Sitemap

    Reviews

    Website Testimonials
    Google Reviews
    Zillow Reviews
    Trulia Reviews
    Facebook Reviews
    Yelp Reviews
    BBB A+ Rating

    FOLLOW US

    • ‎
    • ‎
    • ‎
    • ‎
    • ‎
    • ‎
    Marimark Mortgage is a BBB A+ Accredited Business

    Recent Posts

    • Top Home Loans for Single Moms
    • Documents Needed for a Pre-Approval Letter
    • FHA Announced a 30-Basis Point Reduction to Annual Mortgage Insurance Premiums
    • How Can You Improve Your Credit Score?
    • Historical Mortgage Rates From The 1970s

    © 2023 Marimark Mortgage, LLC All Rights Reserved. | Internet Marketing by Image Building Media. | RSS Feed

    Reviews / Recommendations: Google, Zillow, Trulia, LinkedIn, Facebook, Yelp, BBB

    Licensed in Florida by the Office of Financial Regulation, Mortgage Lender License #MLD77.
    Licensed in Virginia by the Virginia State Corporation Commission, License MC#4556.
    Licensed in Pennsylvania by the Department of Banking and Securities, License #40222.
    NMLS#248318 – www.nmlsconsumeraccess.org.