Planning ahead as a future homebuyer always pays off.
Here are three credit mistakes you can avoid making as you prepare to purchase your dream home!
1. Closing out credit accounts
It would seem like closing unused credit accounts might help you manage credit more efficiently, but this is false. When you close a credit account, it decreases your total amount of credit and causes your debt percentage to jump.
A better alternative: Keep your accounts open with a zero balance!
2. Consolidating debt
When you consolidate debt to one credit card account, you can make that account appear to have a poor debt to available credit ratio.
A credit-friendly option: Keep the debt to total balance as small as possible on each separate account.
3. Falling behind on credit card payments
This one is a silent killer when it comes to credit. The more you make late payments, the more you slip into debt and cause your credit score to drop.
A handy payment tip: Using auto-pay to tend to your bills may help you avoid late payments and boost your credit.