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Improve Your Credit Score in 2022

Are you planning to buy a home in Albuquerque this year? In that case, it might be time to address your credit score. While it’s possible to qualify for a mortgage with scores as low as the 500s, higher scores will yield you more options and better rates, which means greater affordability and more buying power.

It is not possible to raise your score by hundreds of points overnight. However, there are a few tricks that may be able to help you move into the qualification zone or improve your rate and avoid making any silly mistakes.

Pay off collection accounts

If you’re strictly trying to raise your credit score, some older collection accounts aren’t worth paying off. If you can ensure that the creditor will report the payment to the credit bureaus, you may be able to pay newer accounts and improve your credit score. Typically, financial experts agree that you should pay your original creditor rather than the collection agency. Your lender should be able to help you figure out your best plan of action when it comes to who to pay, and how.

Pay down your balances

“The second most important factor in your FICO score is the amounts you owe, which accounts for 30% of your score,” said NerdWallet. FICO also considers how much you owe as a percentage of how much credit you have available. A higher utilization rate increases your chances of overextending yourself and being unable to make payments. Keeping your credit card balance relatively low, then, can provide a significant boost to your credit. Aim for 30% or lower.

Get a credit card

It may sound like the opposite of what you should be doing to improve your credit score, however, the right type of credit can greatly improve your score. “A credit card can be a 100% free way to build up your credit, as long as you use it responsibly,” said Credit Card Insider. “

Use Experian Boost

Experian Boost is a new product “that allows you to add utility and cell phone bills to your credit file,” they said. “Most scoring models take into account your payment history on loans and credit cards, how much revolving credit you regularly use, how long you’ve had accounts open, the types of accounts you have and how often you apply for new credit. If you’ve been making utility and cell phone payments on time, there is a way for you to improve your credit score by factoring in those payments through a new, free product called Experian Boost.”

Dispute Any Inaccuracies on Your Credit Reports

“You should check your credit reports at all three credit reporting bureaus…for any inaccuracies,” said Experian. “Incorrect information on your credit reports could drag your scores down. Verify that the accounts listed on your reports are correct. If you see errors, dispute the information and get it corrected right away.”

Sign up for automatic payments

Your payment history accounts for 35% of your credit score! On-time payments are essential with so much at s8take. Accidents do happen. Automated payments can help you avoid those costly oopsies. For setting up automatic payments, some companies, like T-Mobile, offer monthly savings.

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Learn More!

Contact us today to help you buy or sell your next home in Albuquerque. Looking for the perfect home for sale in Albuquerque? Our easy-to-use home search tool can help you start the process. Join us twice a week on our blog for more real estate advice and great reasons to buy a home in Albuquerque and the surrounding area. Follow us on Facebook for the latest Albuquerque real estate updates.

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Sandi Pressley

Albuquerque New Mexico Real Estate YOUR SOURCE FOR ALBUQUERQUE REAL ESTATE! Sandi Pressley offers unparalleled service to ALL clients in Albuquerque and surrounding communities in the New Mexico real estate market. Sandi's motto is "Putting You First." Your complete satisfaction with our service and representation is our number one priority. As a native of Albuquerque, Sandi Pressley has been dedicated to serving her client's real estate needs for over 43 years. Sandi has achieved a goal unprecedented by any other Realtor of being the #1 Top Producing Realtor for 36 consecutive years in all of Albuquerque as well as the entire state of New Mexico. She is also the #1 Top Producing Realtor for the entire Western Region and 8th in the Nation with Coldwell Banker National. Sandi Pressley serves the entire Albuquerque New Mexico real estate market including the surrounding communities such as Rio Rancho, Placitas, Corrales, Bernalillo, Northeast Heights, North Albuquerque Acres, Sandia Heights, High Desert, Foothills, Four Hills, UNM, Nob Hill, Ridgecrest area, Uptown area, North Valley, Northwest Heights, Paradise Hills, South Valley, Southwest Heights, Bosque Farms, Los Lunas, Cedar Crest, Tijeras, and all East Mountain areas. Whether you are considering buying a home, selling a home or both, we know these areas inside and out.

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