Build Your Credit and Take the Next Step Toward Homeownership

Looking to strengthen your credit and prepare for a future home purchase? You’re in the right place! Understanding how credit works can make a big difference when it’s time to qualify for home financing. Use these tips and FAQs to get started on your path toward confident homeownership.

7 Common Credit Report Questions

1. How is my credit score created?
Your credit score shows how you manage money and debt over time. Paying bills on time, keeping balances low, and using credit wisely all help improve your score. Missed or late payments can lower it, so consistency is key—especially during the mortgage process.

2. What are FICO and the three credit bureaus?
FICO is a scoring model that helps lenders evaluate credit behavior. The three major credit bureaus—TransUnion, Experian, and Equifax—collect and share your credit data with lenders to create your credit report.

3. Why are my credit scores different?
Each bureau may receive updates at different times or use slightly different data. That’s completely normal! When you apply for a mortgage, lenders generally use the middle of your three scores.

4. What credit score should I aim for?
FICO scores range from 300 to 850. In general, higher scores can help you access more financing options and potentially lower interest rates.
All mortgage applications are subject to credit approval.

5. Who are my creditors?
Your creditors are the organizations that have extended credit to you—like banks, credit card issuers, or student loan companies.

6. What do “terms” and “payment amount” mean?
This section shows how much you pay each month and how long it will take to pay off your balance. For credit cards, this is called revolving debt, meaning the account stays open as long as you keep using and paying it.

7. What does “months revolving” refer to?
That’s how long your account has been active. Late payments may appear here as 30, 60, or 90 days late.

6 Credit Dos and Don'ts:

Improve Your Score

Each of the three credit bureaus—TransUnion, Experian, and Equifax—uses its own formula to calculate your credit score. While their exact methods are private, you can visit MyFICO.com to learn about the five key factors that influence your score.

Dispute an Error on Your Credit Report

If you find an error—like an incorrect late payment or account—you can dispute it directly with the credit bureau. Online disputes are often the fastest way to resolve issues.

Know Your Score

Checking your credit score is a smart first step toward homeownership. It helps you understand where you stand and identify opportunities to improve. We have loan options for many scenarios. Contact a Loan Officer to learn more about options available to you!