How to improve your credit before buying a home

By Berenice Cruz · Realtor® · October 8, 2026 · 8 min read

Educational information; not financial advice or a pre-approval.

Step 1: Check your credit reports for free every week

Start by seeing exactly what your reports say. You can check them for free once a week at each of the three nationwide credit bureaus through AnnualCreditReport.com.

The Federal Trade Commission (FTC) confirms that Equifax, Experian, and TransUnion made free weekly access permanent. The official site is AnnualCreditReport.com; be wary of look-alike sites that ask you to pay.

Go through each report slowly: your name, addresses, the accounts you recognize, balances, late payments, and collection accounts. Compare all three, because the bureaus don't always show the same information.

How your score is calculated

Your FICO score is built from five factors with different weights, and the two biggest are your payment history and how much you owe. According to myFICO, the weights are:

• Payment history: 35%
• Amounts owed: 30%
• Length of credit history: 15%
• New credit: 10%
• Credit mix: 10%

FICO notes that these weights reflect the general population and can differ for each person. Still, the takeaway is clear: nearly two-thirds of your score (65%) comes down to paying on time and not using too much of your available credit.

Dispute any errors you find

If you spot a mistake, dispute it with every credit bureau that shows it and with the company that reported it. You can do this yourself.

1. Gather proof: statements, receipts, letters, or any document that shows the error.
2. Dispute with the bureau: the FTC recommends doing it in writing, by certified mail with a return receipt, with each bureau that has the error.
3. Dispute with the furnisher: the Consumer Financial Protection Bureau (CFPB) explains that you can also dispute directly with the company that supplied the information.
4. Keep copies of everything you send and receive.

Bureaus generally have 30 days to investigate, and furnishers generally must respond within 30 days as well. Start months before you apply for a loan so the fix has time to show up. And be cautious with anyone who charges you to promise a quick score jump.

Pay on time, every month

Paying on time carries the most weight in your score. The CFPB calls it the number one factor, and in the FICO model it accounts for 35%.

A few practical moves: set up autopay for at least the minimum, add reminders a few days before each due date, and if you know you'll be late, call the creditor before the date passes. Every on-time month adds to your track record, and that track record is what lenders want to see.

Keep your card balances low

Use only a small slice of your available credit: the CFPB says experts advise keeping your usage at no more than 30% of your total credit limit.

Scoring models look at how close you are to being maxed out. An illustrative example: if your cards add up to a $2,000 limit, the guideline is to keep balances at or below $600. If you owe $1,500 today, paying that down is a good place to start, since amounts owed make up 30% of a FICO score.

Before you use savings to pay off debt, talk with your lender: you may need that same money for your down payment and closing.

Thin credit file? Build it

If you have little credit history in the U.S., a secured card or a credit builder loan can help you get started, as long as you pay on time.

With a secured card, the CFPB explains, you put down a cash deposit, for example $500, and you can spend up to that amount. Payments are reported to the three nationwide credit bureaus, which is how your history starts to grow. The CFPB also points to credit builder loans as another option.

Use it for small expenses you already have, like gas or your phone bill, and pay it in full every month.

Before you apply: don't open or close accounts

In the months before you apply for a mortgage, avoid opening new accounts and keep the ones you have open. When you compare lenders, do it within a short window.

Opening new credit touches the new-credit factor (10%). Closing a card lowers your total limit, which can push up the share of credit you're using even if your debt stays the same. The same goes for financing furniture, a car, or appliances while you're buying a home.

The golden rule while you're buying: no new credit, no closed accounts, and no big purchases on credit until after closing.

When you shop for a mortgage, the CFPB explains that within a 45-day window, multiple lenders can check your credit without additional impact on your score, because those checks are recorded as a single inquiry. The exact window may vary by scoring model, so keep your applications within a few weeks. I walk through this step in what is a mortgage pre-approval.

The scores programs look for

There's no single minimum score to buy a home: each program and each lender sets its own. Here are a few benchmarks.

• FHA: 580 or higher qualifies for maximum financing (3.5% down); 500 to 579 is limited to 90% loan-to-value, meaning 10% down; below 500 isn't eligible (HUD Mortgagee Letter 2010-29).
• NCHFA programs: the NC 1st Home Advantage Down Payment and the NC Home Advantage Mortgage™ require a minimum score of 640.
• USDA: has no specific minimum credit score, though each lender may set its own.
• Conventional and ITIN loans: the minimum varies by lender and program.

Reaching 640 meets the minimum for NCHFA programs. My down payment assistance page lays out the options, which may include up to $15,000 toward the down payment plus closing-cost assistance programs, subject to qualification.

A practical order to get started

If you're not sure where to begin, follow this order: review first, then fix, then build, and apply last. That way each step builds on the one before it.

1. Today: pull all three reports and flag anything you don't recognize.
2. This week: send your disputes in writing and turn on autopay.
3. Every month: pay on time and bring your balances under 30% of your limit.
4. When you apply: shop lenders within a few weeks and open no new credit until closing.

If you'd like a more detailed roadmap, the 90-day plan helps you line up these steps with your savings and paperwork. In the meantime, you can start exploring areas like Monroe and Union County or Gastonia and Gaston County. And if you'd like us to look at where you stand today, book a free 20-minute call. ✦

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