Jeff Duncan Real Estate
Jeff Duncan
(360) 441-2121(360) 441-2121

One Smart Way You Can Save On Your Home Purchase

With continually rising home prices and mortgage rates creeping up, many home buyers are looking for ways to cut down on costs wherever they can. One often forgotten factor affecting your potential home financing is your credit score.  I know, boring right? You’re in luck- I’ve boiled it down for you. Read on for a simple look at how you can bring your credit score up, and the interest rate on your future home loan down.

First, when saving for a home purchase it makes sense to cut costs in all areas.  All but these: bills, debts and credit cards. Ramping up spending on these will increase your credit score, and a higher credit score can save home buyers tens of thousands of dollars over the life of their mortgage.

According to many reputable lenders, borrowers with very good credit scores (740 -799) can save about $29,000 over those with a fair credit score (580-669) on a 30-year fixed mortgage of about $235,000, the average size of these loans. This is due to the lower annual percentage rate and/or lower loan fees a buyer with a very good credit score can qualify for.

So, how specifically can you increase your score?  First, you need to know what your score is. You can get it free from any of the three credit reporting agencies (Equifax, TransUnion and Experian), and some lenders have it available for you when you log into your account online.  If it’s below 760, find out why.

  1. Are you paying your bills late? If so, your score is taking a hit. Set your bills (car payment, credit cards, etc.) up for automatic payment so they are paid on time, every time.


  1. Are you overusing credit cards? Take a look at your statements.  If you are, stop! You may be thinking “Wait a minute! I heard that having a credit card with a balance shows I have established credit!”  You’re absolutely right.  But carrying a balance over 50% of the credit limit negatively affects your credit score. Stop using them and pay them down.


  1. Do you have any debt in the collection process? If you do, it’s getting reported to the credit bureaus and is negatively affecting your score. There are ways to negotiate a payment plan to stop this downward spiral and turn the corner toward a higher credit score.


Some of these steps may be easier said than done.  If you need help finding someone to work with you to bring your credit score up, let me know and I’ll put you in touch with a fantastic lender!

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