We’re Buying a House! Step 1: Fix Credit
Rachel and I plan on buying a house in 2015! In the meantime, we are studying our credit like it's a final exam. In this sponsored post on behalf of Credit Karma™, I will tell you all about my experiences.
We are looking at homes that have an acre (or so) of land, so we can have chickens and a big garden… basically a mini (mini!) farm. We'd love to have our own farm-fresh eggs to eat each morning! While we were pre-approved for a $150,000 loan, we know we want to cut our expenses, so we are looking at houses that are listed at $100,000 or less. A bigger house would be wonderful, but realistically speaking, we'd like to retire at an early age – so now's the time to get our ducks in a row!
Getting our ducks in a row means improving our credit score so we can purchase a house with a great interest rate on our loan. We don't have bad credit, but we do have NO credit – which is just as bad when it comes to getting a loan! Thankfully, we're able to use free tools to improve our credit score before we buy a house.
If you haven't yet, start tracking your credit on the Credit Karma™ website.
Even if you aren't looking to buy a house, Credit Karma™ is a great solution for everyone, because everyone should be educated on their credit situation. Monitoring your credit with a free service like Credit Karma™ is the best way to prevent identity theft from getting out of control if it should ever happen.
Credit Karma™ offers a large variety of tools and resources to help you fully understand your credit data, what impacts it, and how to get back on track if you don't like your credit score number. But how can the tools and resources Credit Karma™ offers help you achieve and maintain good credit?
Good question! Credit Karma™ wants you to take care of your credit and finances, and they will help you do so. They never ask for your credit card information, and you can check your credit score any time you'd like.
You can get a full credit report as often as once a week, and their free credit monitoring gives you peace of mind when it comes to things like identity theft. Credit Karma™ will send you alerts when your credit limits change, and for many other reasons – just opt in to the ones you'd like to receive. You can also view it all on your phone, which is super convenient.
The Credit Score Simulator has helped us a lot. For example, if we get a credit card with a $1000 limit, Credit Karma™ shows us that our score could potentially go up 50+ points if payments are made on time and it's utilized properly.
Sign up for Mobile Alerts on your phone, and Credit Karma™ will send you an alert when there are any changes made. For example, if you're using too much of your credit card limit, it will tell you that your utilization rate is high. If you close an account, that will be listed as well.
When talking to the lender about our credit and house buying possibilities, they said you really don't want any recently closed accounts on your credit report. If you want to buy a house within the next year, work on opening new credit lines and then use 10-15% and leave the rest alone. Make your payments on time, and your score should go up.
There are over 50 different types of FICO scores, but Credit Karma™ does a real score, which gives you a better overall look at your financial credit health. If you're worried about accuracy, my credit score as listed on Credit Karma™ was just a bit lower than the one that my lender gave me. I asked many of you about your experiences with Credit Karma™, and almost all were positive – and very accurate.
It only takes about 5 minutes to sign up and get started! View your credit reports and utilize their free tools to educate yourself on how to improve your credit. We all know how to set up a budget, we all know we need to improve our credit… now it's time to actually do it.
Did you know?
— 33% of Americans have never checked their credit report
— 25% of Americans have errors that might affect their credit scores
— 80% credit scores are lower than 720
— 720 is the number that gives the best interest rates, financing, etc.
Instead of just throwing numbers at us, Credit Karma™ makes everything easy to understand. Each section has a purpose, and there aren't tons of ads flashing on the screen. While there are premium products (like credit card offers), it isn't spammy or salesy at all. The offers are tailored to fit your situation. The pie chart, color graph, and number line are all very beneficial for visual learners like me!
This is a sponsored post written by me on behalf of the Credit Karma™.