You know how important your credit score is in determining your mortgage qualifications. But you probably believe some common myths about credit scores. Lets’ go over a few misconceptions you might have. Correcting these myths can help you take better care of your score.
- Closing an account you paid in full will boost your score. Actually, sometimes this has an adverse effect. For one thing, it brings down the average age of your accounts (potentially). For another, it may increase your credit utilization rate. Both of these can lower your score.
- There is only one credit score. No, there are multiple credit scores. Your FICO score is the one you are probably thinking of when you are talking about your credit score. But you actually have many scores based on many models.
- Negative items will come off your credit score after paying your debts. No, it can take up to 7 years for these items to be removed. If you want them removed, you need to contact the creditors and ask (they may say yes or no).
- If you check your score, it will go down. No, simply checking your own credit score will not ding your credit. Only hard credit pulls will harm your score, which is not what is happening when you check your own credit score. Lenders who use soft credit checks also will not damage your credit score.
Learn More About Raising Your Credit Score When Buying a Home
Granite West Funding can tell you more about how credit scores work, and give you tips for raising yours when you apply for a mortgage. If you are ready to buy a home or refinance in Oakhurst or elsewhere in CA, please give us a call at (559) 540-2275.
