Having a 630 credit score isn’t bad nor is it that great. Creditors set few guidelines that credit scores above 760 have the lowest risk and can get the best interest rates in acquiring new credit cards and loans.
But let’s say, an individual wants to get a home loan with a credit score of 630, will he/she be approved?
The answer is; it depends. It depends on what type of home loan you are applying for. Based from credit experts, if you have a score of 630, you will be approved, but it doesn’t guarantee you to get the lowest interest rates. So what they suggest, instead of sacrificing the advantage of getting the best rates for your home loan, take time to improve your credit score for 3-4 months. Let’s go back to important determining factors:
- For the next consecutive months, never miss a payment on all your financial accounts.
- Your usage on all your credit accounts should be much less than 30% of your credit limit.
- If financially capable, payoff 90% of your balances on all your accounts.
- You can’t afford to have a returned payment. That is why it is very important to be updated with all the payment details. If you have an automatic payment or direct debit, ensure that your bank details are all updated and correct.
- If you have authorized users on your credit card accounts, you must monitor their charges as well. Or better avoid them from using the credit cards temporarily. The next few months are something critical and you can’t afford any mistakes to happen.
- Avoid using your credit cards online to prevent any possible fraudulent or incorrect transactions. Because if it happens, we know that disputes are hard to be resolved overnight. It takes a while; to make it worst depending on the severity of the fraud transactions it can take few months, it can lead to greater disappointments, knowing that your goal is to improve your credit from 630 to a much higher one for the next 3-4 months.
- If any emergency situation occurs, let’s say a late payment might hit the account. Never allow it to happen. Find ways to prevent it from happening. If it means sacrificing something to avoid that late payment, do so. If you need to call your bank for a payment extension, do so. That is why it is very important to build a good credit and relationship with your banks and credit card companies.
Every time you’re calling their Customer Service, agents can see your credit history with their bank, even the simplest request or complaint you have made, they have all these information noted, once they see that you’ve been handling the account very well and if you need help during unexpected situations, they are very much willing to assist and help you the best way they can. It’s proven. This is the importance of establishing a good reputation and credibility.
All information listed above can be challenging for few but can also be easy for some. We have our own ways to achieve a goal. What matters is the determination and patience to achieve it. Improving a 630 credit score may be hard, but it is possible.