Michigan Real Estate Purchase: Credit, or Reaching for Perfection

I know, seems so simple. Pay your bills on time, don’t claim bankruptcy, but there is a lot more to it than that. So, what goes into a good credit score?

Good Payment History: Obviously.

Length of Payment History: One of the distinct disadvantages of a younger person.

Balance to Limit Ratio: For your credit cards it is essential to keep the balance below 50 percent. If you really want to have great credit, 30% is even better. The dollar amount is not important, it’s the percentage.

Diversity of Accounts: Mortages, car loans, installment loans, student loans, credit cards, and charge cards they all help to show the variety of debt that you can properly manage.

Manageable Inquiries: No more than one per month. This will show that you are not trying to obtain new debt at a rate faster than you can handle.

Solely Owned Debt: Fairly new to the credit factor, but it is essential to have debt you obtained on your own rather than cosigned accounts.

Take all of these into consideration when trying to perfect your credit and make sure that you can make the payment before obtaining any new debt.


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