| Lenders always use your credit scores to gauge | | | | of these 3 variables. |
| whether or not you apply for a home mortgage and | | | | Payment history - ALWAYS pay your bills on time. |
| whether or not you get a good, excellent rate, or just a | | | | For the first time home purchaser, late payments will |
| high rate you're not comfortable paying. | | | | always play a major role in reducing your score |
| Before lending you money to finance your first home | | | | Minimize Debt - If you can pay in cash, then pay in |
| purchase, lenders will have to determine how much of | | | | cash. Grocery purchases are better off being paid in |
| a risk you are. That is to say, they want to know what | | | | cash to avoid accumulating unnecessary increases in |
| the risk is of you not being able to pay them in the | | | | credit card balance. A low debt to credit limit ratio is |
| future. | | | | important to keep your score high. |
| Increases in scores require a certain effort on your | | | | Length of Credit History - Do not apply for several |
| part. Make sure to always pay down debts (principal) | | | | credit lines at once. Stick to one or two and maintain |
| whenever you can and to always dispute incorrect | | | | them for a long time. Applying for several credit cards |
| information in your credit reports with your reporting | | | | may give the creditors a red flag in terms of your |
| agency. | | | | capability to service your debt obligations. |
| Basically credit scoring systems computes your score | | | | Keep these three variables in check so when you |
| on the following variables:i) payment history,ii) balance | | | | purchase your home, you're sure that you lock in on |
| you owe, andiii) length of credit history | | | | the lowest rates for your home mortgage. This should |
| Improving your credit score involves focusing on each | | | | make your life easier in terms of mortgage payments. |