5 Credit Habits to Break in 2015

So you’ve decided 2015 is the year you’re going to make a major housing change. It’s now time to confirm your credit behaviors are at the pinnacle. Because buying a house is the biggest expense you’ll probably ever undertake, your credit needs to be looking strong because it plays a major role in the terms and conditions you get from a lender.

                If credit is on your list of items to improve this year, there are a few options to tune up the way you think about and interact with your credit score. Just knowing the answers to boosting this score can take you quite far. Let’s begin…

  • Being Disconnected:  Not checking your credit report

Break the habit of not checking your credit report. Check your report regularly to know where you stand. You should consider your credit report like a map to all your credit behaviors. It’s important to know how your report will be viewed by lenders and others when they see it for the first time.

  • Overspending: Running up or maxing out your credit cards

It’s best not to have a credit card, but if you must, do so responsibly. Keep your spending under control and within your budget. Keeping tabs on how you spend now will help you evaluate how much your budget can fluctuate when you decide to buy a house.

  • Managing Balances: Just paying the minimum balances due on your accounts

Pay more than the minimum. Throw everything you have without starving yourself or your family at the debt you’ve accumulated. Not only will this look responsible on your behalf, but it will also save you money on the interest in the long run.

  • Seeking too Much: Applying for credit indiscriminately

Once again, don’t have a handful of credit cards, but if you must, then do it sparingly. If you have numerous credit cards from 15 different companies then your credit-utilization rate will be pretty high, this is not a good thing. Lenders are weary of applicants that look as if they’re trying to accumulate excessive credit and overspend.

  • Getting Behind: making late payments

Stay up to date with your payments on every account. If you are late your credit score will turn into a hideous monster and scare away all the lenders. It’s very important to stay on top of your payments in the coming months up to your big purchase. It’s the most basic, but most important step in showing your personal responsibility to your lenders.

 

Challenge yourself by making this your New Year’s resolution and allow yourself to take advantage of the months before your new home search begins. Kick your bad credit habits for good. You’ll gain the peace of mind of knowing when you do find that perfect listing, your credit won’t be standing in the way.

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