A credit report is something that is required when applying for a loan to buy a house. The decision the lender makes with regard to your loan can largely depend on what your credit report reveals. For example, it will let the lender know if you pay your bills on time or if you have a lot of debt. Naturally you will want to have a good credit report, so what are some ways you can improve it?

One way is to never miss a credit card payment. If it is hard for you to remember, set up an automatic payment plan to at least pay the minimum amount due. This will ensure you don’t have a late payment and the fees that go with it.

If you have credit cards you no longer use, contact the company to cancel the card. Having numerous accounts open might make a lender think you are giving yourself too much available credit and that you will put yourself in economic danger. Keep in mind, however, that its not a good idea to cancel your oldest credit card because this will show a longer credit history.

It’s a good idea to obtain a copy of your credit report before you decide to apply for your loan. You are legally entitled to one free copy of your credit report every year (or 12-month period). Finding out your credit report ahead of time will enable you to be prepared ahead. On occasion, a credit report might contain an error that would affect your loan application. Finding this yourself would enable you to have the error fixed before you go through the application process.

This is just a few of the ways you can improve your credit report and help you to be better prepared to buy your own home.

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