When planning to buy a house, credit score plays an essential role. Especially as a single parent. Unlike couples going into home ownership, as a single person, we only have the one score to use. The goal is to try and get your credit score highest as it can go.

Credit Score to Buy a House

The question most have is exactly what credit score to buy a house? Prior to what many believe, you do not need a perfect number, like say, a credit score of 800 to buy a house. In fact, the minimum credit score for an FHA loan is 580. However, there are many advantages to being higher on the credit score chart when buying a house. The biggest advantage being it’s cheaper to borrow money when you have a higher credit score. You can save thousands over the lifetime of the loan. It’s definitely to your advantage to get your credit score as high as possible before applying for a mortgage.

Increasing Your Credit Score

When I made the decision to purchase a house, I know I need to raise my credit score to be approved for a mortgage. Unsure of what credit score needed to buy a house, the first thing I do is pull my credit report.

Now, if you’re anything like me, I wanted to cry when I read my credit report.

My credit score average was way below what even FHA was asking for. But, instead of feeling sorry for myself and giving up on my dream of home ownership, I started to put strategies in place to raise my score and guess what? It worked! Trust me, it didn’t happen overnight, but with patience and consistency it finally happened. I’d like to say it took me a year to achieve the credit score needed to buy a house.

How to Raise Your Credit Score

1. Pull Credit Report
Pull your credit report and review for any inconsistencies. Contact the credit bureau should you find any. If there are any accounts in collections, make arrangements to get these past due accounts paid.

2. Reduce Credit Card Balances
The lower your credit card balances, the higher the credit score ratings. This is because the lower amount of credit card debt you carry positively impacts your debt to income ratio.

3. Improve Payment History
Paying your bills on time not only helps to increase your credit score, but it’s also a building block to establishing behaviors that contribute to solid financial health.

4. Do Not Apply for New Lines of Credit
If you apply for new lines of credit such as a credit card, this produces an inquiry on your credit report. Too many inquiries on your credit report can lower your credit score.

5. Don’t Close Any Accounts
It may seem like closing an account actually works in your favor – but it doesn’t. Closing an account reduces your available credit which negatively impacts your credit score.

6. Read Credit Repair Books
If your credit score is in need of a lot of help, it can be overwhelming taking the steps to increase the number. Reading a credit repair book such such as Credit Repair for Dummies can help make the process easier to understand and manage.

7. Become an Authorized User
Ask family or close friends to add you as an authorized user to one of their accounts to help boost your credit score.

How does the saying go? Rome wasn’t built in a day? Same with increasing a credit score. It takes time. But when you’re looking towards the dream of home ownership, the reward is more than worth the sacrifice.