Introduction
Your credit score is one of the most important factors in getting approved for a mortgage. A higher score can mean lower interest rates, better loan options, and thousands in savings over the life of the loan. Unfortunately, many buyers make credit mistakes right before applying. Here are the most common pitfalls to avoid and what to do instead.
Mistake #1: Ignoring Your Credit Report
Too many buyers assume their credit is fine without checking. Errors are common and can drag down your score. Review your credit reports early. Budgeting comes first. See how much home you can afford to set realistic goals before applying.
Mistake #2: Maxing Out Credit Cards
High balances relative to your limit (utilization) can hurt your score. Paying balances down to below 30%, or even better 10%, can boost your score quickly. First-time buyers often make this error. See first time buyer mistakes to avoid.
Mistake #3: Opening New Accounts Before Buying
A new credit card or auto loan may drop your score or increase your debt-to-income ratio, which can harm your mortgage approval chances.
Mistake #4: Closing Old Accounts
Closing old credit lines shortens your credit history, which makes up a big part of your score. Keep older accounts open even if you rarely use them.
Mistake #5: Forgetting the Importance of Pre-Approval
Even with a solid score, lenders want to see stability. Avoid late payments and major financial changes right before applying. This is where pre-approval vs prequalification can help you understand lender expectations.
Final Thoughts
A strong credit score is not built overnight, but avoiding these mistakes and making smart choices can make a big difference. Start checking your reports, lower your balances, and stay consistent. A strong credit score is one of the best gifts you can give yourself as a buyer. Pair these strategies with how much home you can afford, avoid first time buyer mistakes, and understand pre-approval vs prequalification before starting your search.
Your questions, answered
What credit score is needed to buy a house?
Most lenders look for at least 620, but higher scores unlock better rates and terms.
How long does it take to improve a credit score?
Minor improvements can happen in weeks, while significant gains may take months.
What is the fastest way to boost credit before buying?
Paying down credit card balances and avoiding new debt are two of the fastest ways.
