There’s no denying that credit score is one of the main criteria lenders look into for home loans in Santa Cruz, CA. The chances of getting favorable deals are better with a healthy credit score. Therefore, if you are applying for a mortgage loan, it is recommended, among other factors, to revisit your credit score.

A credit score between 690 and 719 is considered good; 720-860 is excellent. When a credit score falls between 300-689, it needs improvement.

Now, the question: what affects your credit score? There are several elements to consider, but the two factors having the most influence are credit utilization and payment history. The former pertains to how much of your available credit you use; the latter refers to your record of paying your bills.

Indeed, responsible spending and good credit habits can go a long way in improving your credit score. Consider the following:

Paying the bills on time – a missed or late payment does have a negative implication on your credit score, which can stay on your credit report for up to seven years. Remember to pay on time, as payment history can impact your credit score.

Keep credit accounts open – when your older credit card accounts do not impose high fees or render poor service, then keep these accounts. Why? Closing an account affects your overall credit limit, which drives up your credit utilization.

Below 30% credit utilization – it is imperative to keep your credit card balances well below your credit limits; keeping it under 30% utilization impacts your score. That is why, as discussed earlier, closing a credit account can increase your utilization. For example, if you have two credit cards, and you suddenly cancel one without changing your spending habits, it could increase your credit utilization, possibly more than 30%, which could negatively impact your credit score.

Again, a credit score is one of the main factors that could determine whether or not your home loans in Santa Cruz, CA, merit approval.

—

Are you looking for a reputable mortgage company to help with your application for home loans in Santa Cruz, CA? Look no further than HomePlus. Call us at 800-810-PLUS (7587) for inquiries.