June Blog & Emails (1)

Let’s talk about credit scores—one of the biggest factors in getting approved for a mortgage, car loan, or even a credit card. Yet, they’re also one of the most misunderstood parts of personal finance.

I can’t tell you how many times I’ve had someone say, “But my credit score is 800 on [insert online service here]—why is my lender telling me something different?”

Here’s the thing—not all credit scores are created equal. And if you or someone you know is looking to buy a home, understanding how scores work, how they differ across industries, and how to improve them can make all the difference.

So, let’s break it down the simple, no-BS way.

Why Credit Scores Matter (Especially for a Mortgage)

Your credit score is like your financial report card—it tells lenders how responsible you are with borrowed money. A higher score can mean:

✔ Lower interest rates (which means a lower monthly payment)
✔ Easier loan approvals (fewer hurdles in the mortgage process)
✔ Better loan options (more flexibility with down payment & terms)

A lower score? It can mean higher interest rates, fewer loan options, or even being denied altogether.

The key takeaway: The better your score, the less borrowing costs you—plain and simple.

The Credit Score Confusion: Why the Numbers Don’t Always Match

Ever checked your credit score on a free online service and then been shocked when your mortgage lender pulls a totally different number?

That’s because there’s not just one credit score—there are dozens of scoring models.

  • Mortgage lenders use a specific version of FICO scores (which is different from what’s used for car loans or credit cards).
  • Auto lenders use a different scoring model designed to predict how well you’ll handle a car loan.
  • Credit card companies use yet another model to assess risk for revolving credit.
    Online credit monitoring services often show VantageScores, which are NOT the same scores that mortgage lenders use.

Bottom line: The score you see on your banking app or free credit website is likely NOT the one your mortgage lender will see.

How to Improve & Maintain a Strong Credit Score

The good news? Improving your credit score isn’t magic—it’s just about smart habits. Here’s what actually works:

1. Pay Your Bills on Time—Every. Single. Time.

Your payment history is the biggest factor in your credit score. Just one late payment can hurt you, so set up autopay or reminders to stay on track.

2. Keep Credit Card Balances Low

Credit utilization (how much credit you’re using vs. your total limit) is the second biggest factor.

·         Keep balances below 30% of your total credit limit (below 10% is even better).

·         Even if you pay your card off in full each month, high balances at the time of reporting can still hurt your score.

3. Don’t Open Too Many New Accounts at Once

Every time you apply for a loan or credit card, a hard inquiry appears on your report. A few are fine, but too many in a short time can make you look risky.

4. Keep Old Credit Accounts Open

Length of credit history matters, so don’t close that old credit card you never use—it helps boost your average account age.

5. Check Your Credit Report for Errors

Mistakes happen! Review your credit report regularly for errors, fraudulent accounts, or incorrect late payments. You can get a free report from AnnualCreditReport.com.

6. Avoid Co-Signing Loans Unless You’re 100% Sure

If the person you co-sign for misses payments, it’s YOUR credit score that takes the hit. Be cautious.

How Long Does It Take to Improve a Credit Score?

Improving your score isn’t instant, but with consistent habits, you can start seeing changes in a few months.

  • Late payments? They stay on your report for 7 years, but their impact lessens over time.
  • High balances? Pay them down, and you’ll usually see an improvement within one to two billing cycles.
  • New credit accounts? They take time to build history, but steady, on-time payments will help.

The Bottom Line

Your credit score isn’t set in stone—you have the power to improve it, protect it, and use it to your advantage. Whether you’re looking to buy a home or just want better financial opportunities, making small, smart changes today can pay off big time down the road.

And if you—or someone you know—is thinking about buying a home, let’s talk! I can help break down what score you need, how to get there, and what loan options might be available.

Because the right knowledge + the right strategy = a stronger financial future.  

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