If you are looking to build your credit to purchase a home, get in touch with a mortgage lender for some guidance on building credit.
I wrote a VERY informative e-book on the subject. I was plagued with bad credit years ago and turned it around all on my own. Please visit the link below. You'd be surprised to know 1/2 the things that are in there. I hope this helps.
NMLS # 6395
Financing Kentucky One Home at a Time
I answer questions about financing real estate based on my decades of experience dealing with mortgage underwriters. This answer is my personal opinion, has not been reviewed or approved by the company I work for. I do not offer legal or tax advice, if you need answers from an attorney or CPA find one knowledgeable in your local market.
Payment history (35%)
The first thing any lender wants to know is whether you've paid past credit accounts on time. This is one of the most important factors in a FICOÂ® Score.
Amounts owed (30%)
Having credit accounts and owing money on them does not necessarily mean you are a high-risk borrower with a low FICOÂ® Score.
Length of credit history (15%)
In general, a longer credit history will increase your FICOÂ® Score. However, even people who haven't been using credit long may have a high FICO Score, depending on how the rest of the credit report looks.
Your FICO Score takes into account:
â€¢how long your credit accounts have been established, including the age of your oldest account, the age of your newest account and an average age of all your accounts
â€¢how long specific credit accounts have been established
â€¢how long it has been since you used certain accounts
Types of credit in use (10%)
The score will consider your mix of credit cards, retail accounts, installment loans, finance company accounts and mortgage loans.
New credit (10%)
Research shows that opening several credit accounts in a short period of time represents a greater risk - especially for people who don't have a long credit history
And as stated below the reason may be becuse you have no recent credit history to generate a good score. That is a guess on my part.
Loan Officer/Real Estate Asset Planner
Financing Solutions for Arizona Real Estate since 1993
American Financial Lending, Inc.
20860 N. Tatum Blvd, Suite 160
Phoenix, AZ 85050-4277
602 277-3800 w
602 631-9788 f
602 524-2401 c
602 912-9438 h
BK # 0910057 NMLS LO ID # 284875
If you have no credit cards, no open lines of credit, no rotating debt (no car payments, mortgages, etc..) then they have no way to see how you handle credit, therefore your score would be low.
Open up a couple of credit cards (maybe a local department store, and a gas card)... use them, and pay them on time (or early). You don't have to charge a lot... if can be $50.00... but pay it on time, each and every month... and use them. You'll see your credit score climb quickly, over several month... and I wouldn't be surprised if by a year, your score climbs into the 700's.
As other's have stated, for your credit score to go up, you would need open available credit and to use it wisely! I have a lender that I have partnered with that gives free credit counseling and can help get credit scores up and even at 550, he has programs that would be available for you to obtain a loan to purchase a home if you were looking for one. If you can contact me, I would be happy to assist!
Stunning Homes Realty
hope this was helpful , have a great day