As rates on 30-year fixed mortgages hover around 3.5 percent and home prices in many parts of the country are starting to dramatically rise, it may finally be time to take the plunge and purchase the home you've been saving for all these years.
If you're a first-time buyer that doesn't have to sell an old house before buying the new one, then you may be really excited about finally getting into the game. Those who can quickly qualify for a good mortgage in this lending environment will most likely be patting themselves on the back five or ten years down the road.
Tighter underwriting standards brought to pass in the wake of the 2008 crash 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 be penalizing 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 for a home loan or pay off your credit card balance in full halfway through the month.