How Can I Increase My Mortgage Credit Score?
DDA Mortgage • September 7, 2021
Did you know... if you have a $10,000 limit on a credit card, are utilizing $1,000 each month, are paying the card off, and are putting the $1,000 right back on, you are hurting your credit score?
Why?
It is all about utilization, and when you pay it off and put it on, it hurts your credit score.
Try this instead.
If you have a balance of $1,000, pay it off. Then try only putting $300 on the card each month. You can pay off the $300 balance each month and improve your score.
How does this work?
When you make this change, you have used $1,000 of your credit, and now you are using $300. You are now at 30% of the $1,000 and have a 30% utilization.
It does not matter about the $10,000 limit – the limit has never been fully utilized. Your credit is dependent on your usage and utilization.
If you are thinking of buying a home, it is critical that you have the highest credit score possible to get the lowest interest rate available. The best way to improve your score is to talk to one of our mortgage specialists. We can look at your credit and let you know how to improve your score.
For more tips, check out 3 things you can do to improve your credit scores.
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Yes, the reverse mortgage market is projected to experience growth in 2025. Analyses indicate that the market size will increase from $1.79 billion in 2024 to $1.92 billion in 2025, reflecting a compound annual growth rate ( A reverse mortgage can be a useful financial tool for certain homeowners, especially older adults looking to access home equity without selling their home. Here are the key benefits of a reverse mortgage: 🏡 1. Access to Home Equity Without Selling You can tap into your home's equity and receive funds as a lump sum , monthly payments , or a line of credit , without having to sell your home or move out. 👴 2. No Monthly Mortgage Payments Unlike a traditional mortgage, you don’t make monthly payments . Instead, the loan is repaid when you sell the home, move out permanently, or pass away. 💵 3. Flexible Payout Options You can choose how to receive the funds: Lump sum Monthly payments (tenure or term) Line of credit Or a combination This flexibility helps match your financial needs. ✅ 4. Stays in Your Name You retain ownership of your home, and as long as you meet the loan requirements (like maintaining the home and paying property taxes/insurance), you can continue to live there. 🛡️ 5. Non-Recourse Loan You (or your heirs) will never owe more than the home is worth . If the home’s value drops below the loan balance, the FHA insurance (if it's a HECM—Home Equity Conversion Mortgage) covers the difference. 👨👩👧👦 6. Heirs Have Options When you pass away, your heirs can: Repay the loan and keep the home Sell the home and keep any remaining equity Walk away if the loan balance exceeds the home’s value 💰 7. Supplement Retirement Income Reverse mortgages can provide a source of income during retirement, helping cover expenses, delay Social Security, or preserve investments. Would you like a quick rundown of the downsides too, just so you have the full picture?
