Credit Tips

Get a pre-approval. The first step in purchasing a home should be to meet with us, your mortgage broker, and determine the feasibility of a purchase. Next, determine what you can afford and get a pre-approval or a “rate hold” to hold the current interest rate for 120 days and protect you from any market fluctuations.

  • Have Active Credit

    Make sure you have active credit, whether it be credit cards, lines of credit, or loans. A common misconception is that no credit is good credit however this isn’t true as lenders base your viability as a client on your repayment history. If you have no credit history, it will be difficult to secure a mortgage with a co-signer or guarantor. The minimum a lender or mortgage insurer is looking for is 2 years credit history.

  • Pay Credit on Time

    Make sure the credit you do have is paid on time. This may seem like an easy thing but it’s not difficult in our busy lives to miss a payment or two. When this happens two or three times in a year, then it becomes an issue.

  • Do Not Exceed Credit Limits

    Make sure you do not go over your credit limits. When a credit card is over its limit, it significantly impacts your beacon score.

  • Access to More Credit is Good

    Having access to a lot of credit is not necessarily a bad thing. Many active credit cards that are used once a month and paid do not negatively impact your score. In fact, having access to more credit reflects positively on your beacon score.

  • Limit How Often Your Credit Bureau Report is Pulled

    Having your credit bureau report pulled frequently while you’re shopping for a car or trying to see if you will qualify for credit cards has a negative impact on your beacon score. When your credit is accessed multiple times within a short period of time, it reflects as credit instability and will lower your beacon score. While this isn’t always avoidable, it’s beneficial to try and limit the number of times you allow your credit bureau report to be pulled.

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Have further questions about how to improve your credit? Ask an expert or call us at 905-304-6963.