As rates on 30-year fixed mortgages hover around 3.5 percent and home prices in many parts of the country are starting to rise again, it may finally be time to take the plunge and purchase the home you've been saving for.
If you're a first-time buyer that doesn't have to sell an old house before buying the new one, then you should really be excited. Those who can quickly qualify for a mortgage in this extremely tight lending environment will most likely be patting themselves on the back in five or ten years down the road.
Stricter underwriting standards mean most lenders will require a credit score above 750 to enjoy the very best rates and terms. Every extra point counts these days, so keep in mind that the credit scoring system could penalize you if you use a lot of credit each month, even if you always pay your balance in full.
Your credit utilization counts for 30% of the credit score, and you can start losing points once you pass the 10% threshold. In order to improve your credit utilization ratio and secure those much needed extra points, consider reigning in your spending the month before you apply or pay off your credit card balance halfway through the month.