# Building Credit Before Buying a House
Your credit score determines whether lenders approve your mortgage and what interest rate you receive. Buyers with scores below 620 face rejection from conventional lenders. Those in the 620-679 range qualify for FHA loans but pay higher rates. Scores above 740 unlock the best terms.
Six concrete steps strengthen your credit before house hunting.
First, check your credit reports from Equifax, Experian, and TransUnion at annualcreditreport.com. Dispute any errors that lower your score.
Second, pay all bills on time. Payment history accounts for 35 percent of your score. A single late payment damages credit for seven years.
Third, reduce credit card balances below 30 percent of your limits. Using $3,000 of a $10,000 limit helps more than maxing out cards. This utilization rate comprises 30 percent of your score.
Fourth, keep old credit accounts open. Credit age matters. Closing accounts shortens your average age and lowers available credit.
Fifth, avoid new credit applications. Each inquiry temporarily dips your score by a few points. Space out applications by at least six months.
Sixth, mix your credit types. Installment loans (auto loans, mortgages) plus revolving credit (credit cards) demonstrate you handle different obligations. This mix counts for 10 percent of your score.
Building credit takes time. Most people see meaningful improvements within three to six months of consistent effort. Raising a score from 580 to 650 opens FHA lending options. Pushing from 650 to 740 unlocks conventional mortgages with competitive rates.
Lenders pull your credit right before closing, so maintain discipline through the entire buying process. One late payment weeks before closing kills your approval and lock-in rate.