Happy National Credit Education Month!

Did you know that March is National Credit Education Month? What better time to become familiar with the intricacies of your credit score and re-commit to keeping it as high as possible.

Here are five things you should do in March to foster your credit-score health.

Check Your Credit

Do you plant flowers then never check on them? No. Then why would you treat your credit score like that? Keeping a close watch on your credit report is one of the easiest and smartest ways to protect it. Pull it from www.annualcreditreport.com for free once a year and scan every line. Note the creditors, your balances, any late payments, and any discrepancies in your personal information such as additional names or social security numbers, dates of birth, or addresses.

If anything’s amiss….

Dispute Errors

It’s estimated there are errors on 25 percent of credit reports! Don’t suffer from a poor credit score because there are lines of credit on your report that aren’t yours or late payments showing when you were never late. Go to the bureau’s (either TransUnion, Experian, or Equifax) website that is reporting the late payment and formally dispute the information. You should see results in 30 days. Sometimes disputing credit reporting errors can increase your score 50 points or more!

Understand the Driving Factors

FICO is used in the majority of lending decisions and its score is made up of five factors. The biggest component is payment history, the second is how much debt you are carrying (credit utilization). The other three, which are important but not as impactful as the first two, are how long you’ve had credit (length of credit history), types of credit (a mix of installment and revolving credit is best), and the amount of new credit you are requesting. Find ways to manage these factors responsibly if you need to increase your score.

Be Aware of Coming FICO Changes

This summer, FICO will have a new scoring model , FICO 10 and 10T, that’s expected to be more predictive than the current ones being used. This means that lenders using the FICO 10 and 10T will possibly be able to extend credit to borrowers who wouldn’t have qualified under the previous models.

Keep Debt Low and Pay On Time

Payment history and credit utilization makes up over 50% of a person’s credit score. It pays off big rewards to make both a priority. Start the National Credit Education Month by figuring out ways to lower your credit card debt and getting organized so you don’t miss a single payment.

Does your credit look bad? It may still be a great time to buy a home!

People with credit issues can often still reach their homeownership dreams with one of our loan programs. You may want to consider:

• Using down payment assistance. If you think you can qualify for a mortgage and afford the monthly payment but you can’t save a down payment that covers traditional mortgage loans, think about choosing a type of loanthat provides all or a portion of the down payment for you.
• Leasing with an option to buy. Some sellers will set up a way for their renters to end up owning the property. This may be a way for you to become a homeowner even if you don’t have a down payment or a high credit score.
• Finding a co-signer. Parents, relatives, or close friends will sometimes co-sign a mortgage loan for a loved one. This arrangement lessens the risk to the lender and makes it easier for them to extend a mortgage loan. Before asking, make sure the chosen co-signer has a strong credit score.
• Contacting MIG about its rapid restoring. Remember how many credit reports contain errors? If you don’t want to wait 30 days for the bureaus to address your dispute, talk to MIG about their rapid rescore program which can take care of errors on a credit report in about 72 hours.
• Following steps to improve/repair your score. It doesn’t take a bunch of credit mistakes to lower your score and make it more difficult to qualify for a loan. Unfortunately, only one or two can do it. The good news is that credit scores are not written in stone; they are simply snapshots of your credit profile at a point in time. They change based on the new credit information added to your report. By taking the time to address yourcredit missteps, you can see great gains in your score down the road.

Going into National Credit Education Month, we encourage you to think about your financial goals and begin reaching for them by learning everything you can about credit scores. If homeownership is at the top of your list, call MIG and work with one of our professional loan officers to finally realize your dream.

Down payment assistance for eligible buyers only. Programs based on borrower qualification.