Why Your Credit Score Matters When Buying a Home

A strong credit score can lead to better mortgage rates, lower monthly payments, and more financing options when you're ready to buy a home. Lenders use your score to decide how likely you are to repay a loan, and a higher score often means more favorable terms.

To plan ahead, start by reviewing your credit report regularly. Look for errors and pay down revolving debt. Make payments on time and avoid taking on unnecessary credit lines. If possible, keep credit card balances below 30 percent of the limit to show you manage your finances well.

Avoid opening or closing accounts just before applying for a mortgage. Also avoid large purchases (cards, furniture, etc.) Sudden changes can shift your score in ways that work against you.

Improving your credit score takes time, so the earlier you start, the better your chances of qualifying for the home you want. It’s part of the preparation that sets you up for a smoother path when you enter the market.