As a WA state first time homebuyer, you may not yet have established a perfect credit score. As your credit score has a major impact on the mortgage offers you receive, it is vital that you take the necessary steps to raise your score if possible, and prevent it from deteriorating while you’re shopping for your first home.
Following are some credit score tips to help you do just that.
1. Check our advice for raising your score.
A good place to start with raising your score is this blog post. We have already outlined a number of useful tips and tactics for boosting your credit score fast as a homebuyer.
2. Improve your other financial metrics.
Your credit score is not the only financial measure of your risk as a borrower. You may find it easier to tackle some of the other factors which lenders consider when you are shopping for your first home loan.
- Build up your savings. The more cash reserves you have, the less risky you appear.
- Work on your DTI ratio. See if you can increase your income or decrease your expenses.
Sometimes, offsetting a low credit score through these means is easier than attempting to raise your credit score.
3. Look into programs aimed at first time homebuyers in your situation.
Not all competitive loans require that your credit score be perfect. Government-insured loan programs such as FHA, USDA, and VA make it possible to qualify for low rates and other great benefits even without ideal credit.
Local and state programs sometimes offer down payment assistance as well to first time homebuyers in Seattle and throughout Washington. By making a larger down payment on your first home, you can also help to offset the heightened risk associated with a lower credit score.
4. Work with a credit counselor.
If you have not yet met with a credit counselor, strongly consider doing so if you have the time. A credit counselor can create a customized plan to help you get back on track financially. Not only can this indirectly improve your credit score, but it may also allow you to increase your savings and decrease your DTI ratio.
5. Talk to a mortgage company as far in advance as you can.
You might think that you should put off consulting with a mortgage company until you have maximized your credit score and other financial metrics, but this is not necessarily the best approach.
When you consult with Blue Square Mortgage, we can offer you additional guidance in shopping for your first home without perfect credit. We can tell you more about how you can raise your score, and we can introduce you to some of the home loan programs we offer which could help you qualify for a competitive loan now or in the future when you are ready to apply. To get started, please call (206) 352-6453 to schedule your consultation.