Credit is a crucial component to more than your mortgage application. Your credit score impacts almost every financial aspect of our lives from credit cards to insurance costs. Below are some credit score tips you should keep in mind to keep your score at its optimal best.
1. Paid Tax Liens can be Removed (So can some Unpaid ones)
Paid (Released or satisfied) federal tax liens can be deleted from a credit report and all other public records within 30 days. Federal tax liens can also be deleted if they have balances of less than 25k with on time payments to the IRS.
2. You Can Add Authorized Users to Increase Scores
Adding authorized users can increase credit scores in as little as 3 weeks for free! No fees and no credit checks. Best of all, they cannot be denied by the creditor.
3. You Need To Fix Inaccurate Personal Information
90% of credit reports have additional personal information that is either inaccurate or dated. We have heard of reports with 6 different names, 2 social security numbers and several addresses.
4. To Boost Your Score, Get A Secured Card
Adding secured cards can help improve the credit profile and ultimately help a borrower get a loan approval. This needs to be structured a certain way but is extremely effective within a couple months.
5. Keep Your Balances Below 30% of Available Credit
Credit card balances should be below 30% of credit line all the time. If you need more credit, get another credit card (lenders typically like to see 3-5 trade lines).
6. Consolidate Student Loans, Especially If You Messed Up
If student loans are in default, they can be consolidated and transferred to the U.S. Department of Education. This will make a huge difference in score and overall approval strength.
7. Setup Automatic Bill Pay
If you’re not good at paying bills on time on a monthly basis, set up direct withdrawal of the fixed payment accounts. Virtually, every creditor offers this option and it can turn a terrible payer into a perfect credit consumer for the rest of their lives.
While Cliffco does not DO credit repair or rehabilitation, we do know a few professionals who do. It is important that you deal with a reputable company. If you would like a recommendation, please reach out to Cliffco Mortgage Bankers at (516) 408-7300 or email firstname.lastname@example.org.