By: G. M. Filisko

Published 2010-02-25 13:35:12

Here™s how to clean up your credit so you get the least-expensive home loan possible.

Boost your credit score by paying the balance on your credit cards in full, and on time, every month. Image: Rob Daly/OJO Images/Getty Images

Getting the loan that suits your situation at the best possible price and terms makes homebuying easier and more affordable. Here are seven ways to boost your credit score so you can do just that.

1. Know your credit score

Credit scores range from 300 to 850, and the higher, the better. They™re based on whether you™ve paid personal loans, car loans, credit cards, and other debt in full and on time in the past. You™ll need a score of at least 620 to qualify for a home loan and 740 to get the best interest rates and terms.You™re entitled to a free copy of your credit report annually from each of the major credit-reporting bureaus,  Equifax,  Experian, and  TransUnion. Access all three versions of your credit report at  www.annualcreditreport.com. Review them to ensure the information is accurate.

2. Correct errors on your credit report

If you find mistakes on your credit report, write a letter to the credit-reporting agency explaining why you believe there™s an error. Send documents that support your case, and ask that the error be corrected or removed. Also write to the company, or debt collector, that reported the incorrect information to dispute the information, and ask to be copied on any materials sent to credit-reporting agencies.

3. Pay every bill on time

You may be surprised at the damage even a few late payments will have on your credit score. The easiest way to make a big difference in your credit score without altering your spending habits is to diligently pay all your bills on time. You™ll also save money because you™ll keep the money you™ve been spending on late fees. Credit card or mortgage companies probably won™t report minor late payments, those less than 30 days overdue, but you™ll still have to pay late fees.

4. Use credit carefully

Another good way to boost your credit score is to pay your credit card bills in full every month. If you can™t do that, pay as much over your required minimum payment as possible to begin whittling away the debt. Stop using your credit cards to keep your balances from increasing, and transfer balances from high-interest credit cards to lower-interest cards.

5. Take care with the length of your credit

Credit rating agencies also consider the length of your credit history. If you™ve had a credit card for a long time and managed it responsibly, that works in your favor. However, opening several new credit cards at once can lower the average age of your accounts, which pushes down your score. Likewise, closing credit card accounts lowers your available credit, so keep credit cards open even if you™re not using them.

6. Don™t use all the credit you™re offered

Credit scores are also based on how much credit you use compared with how much you™re offered. Using $1,000 of available credit will give you a lower score than having $1,000 of available credit and using $100 of it. Occasionally opening new lines of credit can boost your available credit, which also affects your score positively.

7. Be patient

It can take time for your credit score to climb once you™ve begun working to improve it. Keep at it because the more distance you put between your spotty payment history and your current good payment record, the less damage you™ll do to your credit score.Read more:  http://buyandsell.houselogic.com/articles/7-tips-improving-your-credit/#ixzz1LFbEcpyZCourtesy National Association of Realtors

2010 Finished out the year where inventory levels are pushing a more stable time frame. Over $200,000 we are looking at higher months of inventory.

Months of Inventory is based on the number of sales in a particular price category divided by number of homes currently for sale in that price range.   As we move into 2011 I expect the inventory to increase thus effecting the number of months of inventory. Prices have dramatically reduced over the last 6 months of 2010 providing for some inventory to clear out.   Great buys everywhere!

Condo sales took a strong decline due to tougher financing requirements. I will talk more in future blogs on new condo rules that associations need to review now so they are able to meet financing guidelines in 2011.

residential home sales 2010 medina county.pdf

As you may have heard there has been a move by many of the large lenders across the country to take a step back and make sure they have followed all the necessary steps prior to taking a seller’s home back.   The foreclosure process in Ohio takes many months to complete and by law certain steps must be performed.

What will this do “temporarily” to the local real estate market. As industry experts point out this is a window of opportunity for non-foreclosure homes to sell.   As the mess is sorted out across the country sellers should focus on pricing their home aggressively.   More and more foreclosed or bank owned homes will eventually pour back into the market bringing inventory levels even higher. Simple supply and demand shows us that this only lengthens a seller’s ability to sell in a quicker fashion. Priced right and in the right condition a home can stil sell.

A website that may be of interest to sellers facing foreclosure is www.foreclosurelaw.org that will identify laws by state.   For example here are a few Quick Facts on Ohio:

Quick Facts

-   Judicial Foreclosure Available: Yes

-   Non-Judicial Foreclosure Available: No

-   Primary Security Instrument: Mortgage

-   Timeline: Typically 150 days

-   Right of Redemption: Yes

-   Deficiency Judgments Allowed: Yes

Stay tuned as I further analyze in coming days the inventory levels of homes for sale in Medina County.

Buyers take note. As of this writing we are actively trying to get the word out that qualifying first time home buyers can take advantage of the $8,000 tax credit.   Think of that as a great price reduction!   You can even ammend your 2008 return if you have already filed for 2008.

Now is a great time to get out of renting. Buyers do need to have some money in reserves of at least 3.5% for FHA guidelines of minimum downpayment.   So on a $100,000 that is $3,500 plus closing costs.  

I was amazed that this is a credit and does not have to be repaid as the other previous plan that was available. So don’t wait 2009 is the time for first time homebuyers as we have wonderful choices of homes in Medina County waiting for a new occupant!

Medina County like other parts of Northeastern Ohio have endured the effects of slowing sales but the numbers tell the true story as we enter the 4th Quarter of 2008.    We are experiencing a  nearly 35% decline in number of unit sales in single family homes in the first 9 months of 2008 vs. same time last year.   The average sale prices remain slightly down.   An area by area breakdown follows.

 Market Activity Report “ Totals by Area January 1, 2007 “ Sept. 30, 2007  

     Market Activity Report “ Totals by Area January 1, 2008 “ Sept 30, 2008  

Welcome to Lori Schwarz’s Blog! This blog will provide you with valuable information, tips, and general insight into the real estate market in Strongsville.