7 Tips For Improving Your Credit

Here’s how to clean up your credit so you get the least-expensive home loan possible

Getting the loan that suits your situation at the best possible price and terms makes homebuying easier and more affordable. Here are seven ways to boost your credit score so you can do just that.

1. Know your credit score

Credit scores range from 300 to 850, and the higher, the better. They’re based on whether you’ve paid personal loans, car loans, credit cards, and other debt in full and on time in the past. You’ll need a score of at least 620 to qualify for a home loan and 740 to get the best interest rates and terms.

 You’re entitled to a free copy of your credit report annually from each of the major credit-reporting bureaus, Equifax, Experian, and TransUnion. Access all three versions of your credit report at www.annualcreditreport.com. Review them to ensure the information is accurate.

2. Correct errors on your credit report

If you find mistakes on your credit report, write a letter to the credit-reporting agency explaining why you believe there’s an error. Send documents that support your case, and ask that the error be corrected or removed. Also write to the company, or debt collector, that reported the incorrect information to dispute the information, and ask to be copied on any materials sent to credit-reporting agencies.

3. Pay every bill on time

You may be surprised at the damage even a few late payments will have on your credit score. The easiest way to make a big difference in your credit score without altering your spending habits is to diligently pay all your bills on time. You’ll also save money because you’ll keep the money you’ve been spending on late fees. Credit card or mortgage companies probably won’t report minor late payments, those less than 30 days overdue, but you’ll still have to pay late fees.

4. Use credit carefully

Another good way to boost your credit score is to pay your credit card bills in full every month. If you can’t do that, pay as much over your required minimum payment as possible to begin whittling away the debt. Stop using your credit cards to keep your balances from increasing, and transfer balances from high-interest credit cards to lower-interest cards.

5. Take care with the length of your credit

Credit rating agencies also consider the length of your credit history. If you’ve had a credit card for a long time and managed it responsibly, that works in your favor. However, opening several new credit cards at once can lower the average age of your accounts, which pushes down your score. Likewise, closing credit card accounts lowers your available credit, so keep credit cards open even if you’re not using them.

6. Don’t use all the credit you’re offered

Credit scores are also based on how much credit you use compared with how much you’re offered. Using $1,000 of available credit will give you a lower score than having $1,000 of available credit and using $100 of it. Occasionally opening new lines of credit can boost your available credit, which also affects your score positively.

7. Be patient

It can take time for your credit score to climb once you’ve begun working to improve it. Keep at it because the more distance you put between your spotty payment history and your current good payment record, the less damage you’ll do to your credit score.

G.M. Filisko is an attorney and award-winning writer who keeps a close eye on her credit scores. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.

 Published: February 25, 2010 By: G. M. Filisko

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Santa Barbara Property Sales - October 2011

Carpinteria

(REO)$185,000 4634 Ninth St

$192,000 5951 Birch St 1

$200,000 5936 Birch St 1

$203,000 7015 Gobernador Cyn

$282,000 6048 Jacaranda Way F

(REO) $350,000 1260 Franciscan Ct 11

$385,500 1413 Sterling Ave

$420,000 1484 Noma St

$520,000 4655 Aragon Dr

$615,000 1098 Linden Ave

$645,000 1477 La Jolla Pl

$1,100,000 7410 Shepard Mesa Rd

$424,792 Avg. Price
$367,750 Median Price
12 Sales

Goleta

(REO)$210,000 31 Dearborn Pl 34

(REO)$230,000 5516 Armitos Ave 79

$258,000 7105 Monique Ct

$300,000 6864 Silver Fern Ct

$325,000 7636 Hollister Ave 259

$363,000 534 Mills Way

(REO)$380,000 7017 Marymount Way

$425,000 107 Cardinal Ave

(REO)$460,000 688 La Roda Ave

(REO)$474,000 581 Poppyfield Pl

$480,000 5134 Calle Real B

$520,000 6245 Momouth Ave

(REO)$525,000 62 Touran Ln

(REO)$545,000 121 Santa Ana Ave

$557,000 523 Inwood Dr

(Reo)$632,000 7952 Winchester Cir

(Reo)$635,000 5155 Tabano Way

(Reo)$650,000 7938 Winchester Cir

$660,000 7319 Greensboro St

$687,000 5083 Parkwood Pl

$715,000 5304 Orchard Park Ln

$740,000 4976 La Ramada Dr

$750,000 5133 Walnut Park Dr

$825,000 6828 Shadowbrook Dr

$830,000 455 Orange Blossom Ln

$930,000 6784 Sueno Rd

$1,048,000 416 Mills Way

$561,259 Avg. Price
$545,000 Median Price
27 Sales

Montecito

$253,000 1125 Westmont Rd

$792,500 755 Circle Dr

$890,000 1355 Santa Clara Wy

$944,000 696 Cowles Rd

$1,060,000 116 Palm Tree Ln

$1,200,000 1368 East Valley Rd

$1,200,000 677 Orchard Ave

$1,550,000 950 Arcady Rd

$2,210,000 660 Randall Rd

$2,300,000 433 Alcala Ln

$3,300,000 275 Olive Mill Rd

$1,427,227 Avg. Price
$1,200,000 Median Price
11 Sales

Santa Barbara

$198,500 220 W Canon Perdido

(REO)$313,000 325 Ladera St 4

$325,000 1233 Richelle Ln G

$331,500 2113 Castillo #A

$340,000 1231 Stonecreek Rd D

(REO)$365,000 3663 San Remo Dr #5a

(REO)$375,000 1305 Cacique St

(REO)$375,000 2626 Calle Real

$380,000 551 E Montecito St

$380,000 557 E Montecito St

(REO)$383,000 1600 Garden St 18

$395,000 577 E Montecito St

$401,000 1709 Sycamore Cyn Rd

(REO)$405,000 433 E Micheltorena St

$410,000 535 E Montecito St

(REO)$425,000 431 E Carrillo St

$426,000 565 E Montecito St

$445,500 579 E Montecito St

(REO)$460,500 3943 Camellia Ln

$470,000 1010 N Nopal St

$475,000 222 Reef Ct

$483,500 452 Fellowship Rd

$485,000 221 Reef Ct

$485,000 2824 Miradero Dr

(REO)$485,000 418 E Sola St

$487,500 573 E Montecito St

$540,000 818 W Mission St

$560,000 823 Alberta Ave

$600,000 3508 Madrona Dr

$600,000 2525 State St 23

(REO)$605,000 305 Sherwood Dr

$615,000 202 San Nicolas

$638,000 515 W Quinto St

$682,500 227 Los Alamos

(REO)$690,000 832 Vales St

$715,000 4004 Via Lucero Unit 4

(REO)$715,000 3997 Foothill Rd

$717,000 1127 Bath St

$730,000 1576 Eucalyptus Hill

$736,000 342 Oliver Rd

$740,000 521 Carriage Hill Ct

$745,000 4018 Via Diego

$750,000 7 St Ann Dr

$750,000 316 W. Ortega #3

$753,000 1132 Crestline Dr

$775,000 1424 Pacific Ave

(REO)$777,000 218 Las Ondas

$780,000 3124 Argonne Cir

$798,500 1109 Las Olas Ave

$858,000 764 Casiano Dr

$867,000 1609 Garden St

$880,000 3677 Eileen Way

$895,000 4868 Vieja Dr

$987,000 3752 Lincoln Rd

(REO)$1,050,000 2020 Las Canoas Rd

$1,100,000 958 Arbolado Rd

$1,220,000 3084 Calle Mariposa

$1,250,000 707 E Valerio St

$1,379,000 1635 Oramas Rd

$1,400,000 1717 Mission Ridge Rd

$1,500,000 2660 Puesta Del Sol

$2,059,000 100 E Constance Ave

$3,580,000 1709 Overlook Ln

$720,113 Avg. Price
$610,000 Median Price
63 Sales

Summerland

$388,000 3960 Via Real

(REO) $500,000 2576 Lillie Ave

$3,415,000 745 Sand Point Rd

$1,434,333 Avg. Price
$500,000 Median Price
3 Sales

Total:

$739,621 Avg. Price
$610,000 Median Price
116 Sales
24% Reo Sales