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The Kathy O'Neal Team

Real Estate in Chantilly Blog

Worried about Your FICO Score? 4 Easy Strategies to Fix It Up

If you are thinking about buying a Chantilly or Northern Virgina are home, no doubt you want to have credit rating that will work in your best interests.  It will serve you in a number of ways, and certainly in applying for a mortgage.

JUST A WORD OF CAUTION!  If you are currently involved in a home loan transaction, speak with your mortgage lender before taking any action regarding your credit!

Here are a few simple things that may help with your FICO score.

Get Your Credit Report And Dispute Any Errors
Credit reporting agencies don’t always keep 100% perfect records, and there’s a good chance that your credit report contains at least one error. One recent FTC study found that 25% of consumers have an error on their credit report, and that in 5% of cases, the errors were actually severe enough to impact the loan terms that borrowers were able to negotiate.

You can get your annual credit report from all three credit reporting agencies for free. Carefully read over it. If you see any errors – if your name is misspelled, if they have the wrong address on file, or if there are late or unpaid charges that you didn’t make – you can dispute the items in question.

Still Overdue? Negotiate Payment Terms With Your Creditors
If you’re overdue on a payment, it will weigh heavily on your credit score. As your payment history makes up a full 35% of your FICO score, this is one area where you’ll want to invest a great deal of time and effort.

Contact any creditors you owe money to and ask if you can negotiate your bill. The ideal outcome for you is to have the creditor report your debt as paid in full, so see if you can secure that promise in writing in exchange for an accelerated payment schedule.

Try Maintaining A Lower Utilization Ratio
Your utilization ratio refers to the amount of credit you use at any given time. If this number goes beyond 30 percent, you’ll start to see your credit score drop. Ideally, you should aim for a utilization ratio below 10 percent – this will prove to your lender that you can responsibly pay for the credit you use.

Automate Your Payments For Recurring Bills
Automating your monthly payments can be a great way to boost your credit score. Whether it’s your mortgage, your credit card, or your student loan, a pre-authorized monthly payment will ensure that everything gets paid on time and give you a great credit history.

Your FICO score is a number that will determine your eligibility for mortgages and other loans, so it makes a lot of sense to get it as strong as possible.

And by the way, if you are still searching for a real estate agent to help you through the whole process, please take a look at what our clients are saying about us.  If you like what you see and hear, let us know how we can help.  We are always here for you!