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How do I benefit from mortgage rates with good credit?

4. Keep older credit lines open

It is important that you do not close older credit lines, even after paying them off. While closing unused accounts may sound like a good idea, it might increase your credit utilization ratio—which can, in turn, cause your credit score to drop.

5. Don’t take on new debts

When applying for a mortgage, the less debt you have, the better off you will be. Because every credit request can lower your credit score, FICO recommends not opening new credit accounts to increase your credit utilization ratio. After your credit has improved, you should rate shop within 30 days, especially since spreading out rate inquiries can damage your credit score.

Mortgage rates are notoriously ever-changing. While some of the factors that contribute to these fluctuations are beyond most homeowners’ control, you can control your credit score. Since your credit score is a major determining factor to the type of mortgage rate you will get, it is important to keep your score healthy. It is also vital to understand how just a few credit points can impact your mortgage rate.

If you are looking for the most favorable mortgage rates with good credit, you may want to speak with a mortgage professional first. We have a list of the USA’s top performing mortgage professionals, including mortgage loan officers, in our Best in Mortgage section.

Have experience getting good mortgage rates with good credit? Let us know in the comment section below.

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