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Does your credit score need a BOOST?

Did you know that individuals who take out an auto loan of $21,778 with a “fair” credit score could pay up to 311 percent more interest than an individual with a “very good” credit score taking out the same loan?! That same difference in credit score is going to have a large impact on your home purchasing power. If this topic leaves you feeling anxious, you are not alone and that’s why so many companies have popped up in the last few years to help us monitor and hopefully improve our scores.

how to boost my credit score

Before you get online and start looking at dream homes, consider checking your score to see if yours needs some work. We also suggest starting here with our True Affordability Tool or consulting a Lender so you know what you can afford. That way you don’t fall in love with a house that is not realistic for you.

When you are ready to apply for a mortgage, your lender will check your credit score as part of the application process. Currently, most lenders use FICO scores which range from 300-850 in determining your interest rate and eligibility for home loans. Many lenders will not offer loans if your score is less than 620. So if you are one of the 62M Americans (source) that have a limited or “thin” credit file (not enough history) or have had a checkered credit history, there is a new program that can help increase your score and move you into a better buying position.

Experian Boost is completely free and can increase your credit scores almost immediately by giving you credit for payments that you’ve made to your cell phone provider and utility companies. The entire process is done online and takes about 20-30 minutes. Here is what you should expect:

  1. Sign up for your free account with an email and password.
  2. Answer several questions to confirm your identity.
  3. Connect to your bank account.
  4. Choose and verify positive payments (it will only pull positive payments).
  5. See newly improved credit score!
how to boost my credit score

An early analysis of the impact of Experian Boost shows that:

  • ⅔ of credit scores were improved
  • 10% of “thin” file consumers were now scoreable
  • 75% of consumers with a score below 680 saw a credit score improvement
  • 14% of consumers with a credit score at or below 579 moved to a near prime score between 620-679
  • 5-15% moved into a better score category

If you are still not confident that your credit is where it needs to be to apply for a mortgage, don’t be discouraged. We can match you with an Agent and Lender that can guide you through your options and get you on the right track to owning your home!

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