bad credit

With historically low interest rates, many potential homeowners are looking to purchase a home and secure a mortgage. Unfortunately, some may be surprised that they are not able to secure the lowest possible interest rate for their financing. 

Often, we do not pay attention to our credit until we need to use it for something. However, if you want to avoid bad credit, you need to take an active role in your financial health. Otherwise, when it comes time to take out a mortgage, you may be surprised.

Stay Current

To stay on top of your credit health, make sure you are making your current payments on time. Whether it is student loans, auto loans, or credit cards, missing a payment can have a negative impact on your credit for up to seven years. If you are having trouble making a payment, do not just skip it. Call your lender.

Do Not Cosign

At some point, a friend or family member may ask you to cosign a loan for them because of their own credit issues. Generally, if these individuals are not able to secure a loan without assistance, they probably should not be getting a loan. Do not tie your boat to theirs. Keep your credit afloat and see if there are other ways you can support your loved one without cosigning.

Leave Retirement Savings Alone

Saving for retirement is crucial. We all want to enjoy those golden years. Unfortunately, some of us may be tempted to dig into retirement savings to catch up on debt payments. There are even individuals who would rather raid their retirement accounts than declare bankruptcy. Often, this just depletes the retirement account and postpones the inevitable bankruptcy. Leave your retirement savings untouched! They are protected in bankruptcy and should not be used to pay off creditors.

Know Your Credit & Debt

Ignorance may be bliss, but when it comes to credit, it is dangerous. If you want to develop a healthy credit score, you must know the interest rates and terms for your different credit cards and loans. 

Check Your Credit Reports

Similarly, to maintain your credit knowledge, you must check your credit reports regularly to ensure there are no mistakes. You can check yours for free right now at If you spot an error, report it to the appropriate credit agency immediately so you can have it taken care of before you apply for a mortgage.

If your credit is in good standing and you are ready to purchase a home, let’s talk. I would love to hear about what you are looking for and connect you with some motivated sellers!