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First-time Homebuyer Tax Credit
For those looking to purchase a home in order to qualify for the First-time Homebuyer Tax Credit, the November 30 deadline is quickly approaching. Here are a few things to focus on before applying for a loan.
1. Pay ALL bills on time—Make sure to pay all bills such as auto loans and credit cards on time. Recent late payments can damage credit scores and potentially be the culprit for a denial in a mortgage loan. Be sure to pay your utility bill on time as well—many utility companies will report to the credit reporting agencies. With the cold temperatures and higher utility expenses, it is important to budget your expenses to make sure that your utility bill is not overlooked. Be aware that signing up for a budget plan could have a negative impact on your credit scores. I have seen on numerous occasions that a utility company will report late payments in error to those who have signed up for this program.
2. Pay down credit card balances—one easy way to quickly increase credit scores is to pay down your credit card balances. Debt utilization accounts for 30% when calculating your credit scores. Try to keep your card balances below 10% of the available limit. If this is not possible, at least be sure the balance is below 50%. Lower balances=higher credit scores!
3. Check your credit reports—Before applying for a mortgage, it is a good idea to check your credit. At no cost, consumers can go to www.annualcreditreport.com and view their credit reports. Be sure to look for any errors and work with the credit reporting agencies to correct them. This will help to ensure the highest possible credit scores. Do not procrastinate because this process could take up to 30 days.
Please contact me if you have any questions. I have helped thousands of people increase their credit scores by analyzing their credit reports and providing them with specific plans of credit improvement based on their individual and personal credit information.
Kevin D. Weier
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