- In this report
- Overview
- Clean up your credit score
- Keep your score blemish free
- Build a cash cushion
- Pay off your credit cards
- Rethink how you use credit
- Don't tap your home equity
- Make a bigger down payment
- Cap your debt
- Try to bulletproof your job
- Also in This Issue
This article was featured in the July 2009 issue of Consumer Reports magazine.
Clean up your credit score
This article is the archived version of a report that appeared in July 2009 Consumer Reports magazine.
Aim to raise your FICO score to at least 720. That is what you'll need to qualify for the best credit-card terms and the lowest rates on home loans and insurance. And in some instances, 720 isn't enough. For example, to get private mortgage insurance (which you'll probably need if you take out a home loan with less than 20 percent down) through insurance giant Genworth on "jumbo" mortgages—more than $417,000—you'd need a score of 740 in virtually any part of the country except California, where Genworth doesn't offer it at all.
If your credit score is lower, you can still qualify for loans and credit cards, but you'll pay higher fees and interest rates. To improve your score, make all your payments on time and in full and correct any mistakes in your credit report. Go to annualcreditreport.com to get free reports from the three major credit bureaus—Equifax, Experian, and TransUnion.
Repairing your score could take months, so get started sooner rather than later if you'll need a loan in the near future. But don't pay anyone to help you fix your credit report or score.
