7 Essential Steps to Boost Your Credit Score for Mortgage Loans

illustration of an approved mortgage application after following the steps to boost credit

As the housing market heats up in 2024 and more consumers considering buying a home, it’s important to consider the role that your credit score plays in your ability to secure a mortgage.

Conventional mortgage lenders will typically want a credit score around 700s, but those with a scores on the 500s -600s may still qualify for a loan, your lender or loan officer will able to put you on the right program.

Here are 7 steps to boost your credit score for mortgage:

1. Review Your Credit Report Card

When preparing for a mortgage loan, start by reviewing your credit report card. Assessing your credit history allows you to identify any potential issues and take corrective measures.

2. Dispute Any Inaccuracies with Credit Recovery Group Assistance

Should you encounter inaccuracies on your credit report, Credit Recovery Group is here to streamline the dispute process. Their expertise can alleviate the headache of resolving discrepancies, ensuring your credit report reflects accurate information.

3. Ensure Multiple Tradelines for Conventional Loan Approval

For conventional loan approval, it’s crucial to have at least three tradelines active within the past 12-24 months. Tradelines encompass various credit sources like credit cards, student loans, and car loans.

4. Preserve Older Credit Lines

Maintain older, more mature tradelines, as they positively impact your credit score. Even if not frequently used, keeping these credit cards open contributes to a higher credit score.

5. Steer Clear of Opening New Credit Lines

Avoid opening new credit lines before applying for a mortgage loan. This helps maintain a stable credit profile and demonstrates financial responsibility to potential lenders.

6. Refrain from Making Big Credit Purchases

Hold off on making significant credit purchases, such as new furniture or appliances, until after your loan finalizes. Doing so ensures a smooth approval process without introducing new credit obligations.

7. Avoid Shuffling Money Between Bank Accounts

To simplify paperwork and streamline the approval process, refrain from shuffling money around between bank accounts. A stable financial snapshot makes it easier for lenders to assess your financial stability.

These strategies not only enhance your credit profile but also contribute to a smoother mortgage loan application process.