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As a mortgage advisor all of my clients want the best interest rates for their mortgage. Other than choosing a great mortgage professional - the best way to ensure you get the best mortgage rates is to maximize your credit score. Great credit history and credit scores look attractive to lenders and they will offer these clients the best possible interest rates.
Read my tips below on how to maximize your credit score. If you need free mortgage advice feel free to call me directly at 905-441-3991 Tim Deering The Mortgage Locator. Click Here for more info
Never Max Out Your Credit Limit
Credit utilization - Credit cards and lines of credit that carry balances over 50% of the available credit amount negatively impact your credit score. Try to always keep credit balances below the 50% mark. If you carry credit balances try and spread it out over different cards don't carry big balances on the same card or line of credit. Credit utilization accounts for approx 30% of your credit score.
Never Go Over Your Credit Limit
When you have credit cards or lines of credit that carry balances near the limit, you run the risk of going over your credit limit sometime this can happen accidentally because of an interest charge that you didn't factor in. Accident or not going over your credit limit will negatively impact your credit score and potentially get you in trouble with the credit issuer. Always leave some extra room. If your available credit is $5,000 never run it up over $4500. This should eliminate you ever going over the limit accidentally.
Always Accept Offers of Credit Limit Increases
Even if you don't need the extra credit always accept offers from the bank or credit card company to increase your credit limits. Higher credit limits make you look like a stronger candidate to lenders it will also boost your available credit amount, this will increase your credit utilization percentage that will in turn increase your credit score.
Use All of Your Credit Sources
Don't let your cards or lines of credit go stale. It's easy to have a favourite card or use a card that offers the best rewards. Use all your cards regularly. Try and use some portion of your available credit often and simply pay it off right away. Accounts that sit dormant for too long will negatively impact your credit score. Some lenders may even revoke or reduce your available credit amount.
Never Be Late With Your Payments
Paying credit cards, loans or lines of credit late are disastrous to your credit score. Late payments stay on your account for years and will look really bad to prospective lenders. Even one 30 day late payment will be a black mark on your credit profile and will haunt you long in to the future. Keep track of your payment cycles and always pay off your minimum payments or balances at least 7 days prior to the due date.
Check Your Own Credit Report on a Regular Basis
You should pull and monitor your own credit report at least twice per year. Not only will this help protect you from fraud or identity theft but it will also help you monitor your reports for errors. If you ever see any errors on your credit report contact the credit reporting agency right away and have it removed or corrected. In Canada the 2 main credit reporting agencies are Equifax and Trans Union I recommend you pull your own report on both agencies as the information may differ from either agency.
Remember if you want to get approved for a mortgage with an A lender and be offered the best mortgage rates. Look after your credit and monitor your credit reports. This way you will be prepared and you will not be surprised by unexpected questions that may pop up from lenders.
Mortgage agents can help you get approved even if your credit is not perfect. As a mortgage agent I deal with many different types of lenders that can help with all types of credit situations. I can also show you how to get your credit in shape before you apply to the lender for a mortgage.
My Name is Tim Deering, I am The Mortgage Locator. Call me direct at 905-441-3991 or
Click Here for more info.