First Steps

4 Best Ways to Improve Your Credit Score for a Mortgage

Published on: July 8, 2021

best ways to improve your credit score

If you want to buy a home but don’t have a pristine credit score, you may be wondering what are the best ways to improve your credit score. These all-important scores aren’t set in stone and can be polished up with a bit of attention and diligence. Actions like bringing overdue accounts current, paying down your credit card debts, and fixing mistakes on your credit report can boost your credit score substantially. 

Because a solid credit score is one of the keys to getting an affordable mortgage, potential homebuyers should stay on top of the factors that go into the score calculation. 

What are the best ways to improve your credit score?

The best ways to improve your credit score for a mortgage depends on what your credit score is and what types of credit data are weighing down your score. It’s easier to make a significant improvement on a score that’s fair to poor than one that’s already quite high.  

Let’s take a look at the five basic pieces of credit data that go into the calculation of your credit score. Think of these factors as the tools you can use to fix your credit score. 

What goes into the calculation of your credit score? 

Credit data  Weighting 
Payment history  35% 
Amounts owned  30% 
Length of credit history  15% 
New credit   10% 
Credit mix  10% 

Source: MyFICO

There are four main methods of boosting your credit score. We’ll walk through the nuts and bolts of each one, starting with the most impactful way to boost your score.

1. Improve your payment history

Lenders know that payment history, or your track record of making on-time bill payments, is a strong predictor of creditworthiness. That’s why this is the largest component (35%) of how your credit score is calculated. Cleaning up your payment history can take a long time, but the best way to get started is by catching up on any overdue accounts and forming a good habit of paying all bills by their due dates.  

Credit bureaus look at late payments for accounts such as: 

  • Credit cards 
  • Department store credit cards 
  • Auto loans, student loans, and other installment loans 
  • Finance company accounts 
  • Mortgages 

Credit bureaus also consider how long any of your late payments overdue, how much was owed on delinquent accounts, the number of past-due items you had on your credit report, whether you’ve had any bankruptcies or lawsuits, and the amount of time that has elapsed since those events occurred.  

To repair your payment history, take these steps to boost your credit score over time:

Catch up on past-due accounts

Getting all your accounts current is crucial, since credit bureaus keep track of how late your bills were paid and any amount you still owe. You don’t want collection items lingering on your file. As time passes, problem items will gradually weigh less on your credit score. Get any past-due accounts squared away as soon as possible.  

Make on-time payments

If you’re not too organized with bills, set up a good system to make sure all your future payments are on time. Setting up autopay on recurring bills is a good option. Some companies offer a small discount or reward as an incentive for customers who use this feature.

2. Lower your credit utilization ratio

Lenders care about how much of your available credit lines you’re currently using. This percentage is called the credit utilization ratio. You can quickly adjust your credit utilization ratio, and this is one of the best ways to increase your credit score quickly. Aim to use no more than 30% of your available credit lines; keeping balances low will also help lower your debt-to-income ratio. 

Here are the best ways to improve your credit utilization ratio:  

Make more frequent payments 

A fast way to improve your credit score is to start making multiple “micropayments” each month, instead of just one large payment. This keeps your average credit card balances lower, giving you a lower credit utilization rate.  

Request higher credit limits 

Another strategy for improving your credit utilization ratio is to call your credit card companies and request higher credit limits. They may be willing to raise your credit limits, which would automatically lower the percentage of available credit that you’re using.  

However, clarify whether your credit card companies will need to do a “hard” credit check before approving a credit limit increase. While a “soft credit inquiry” won’t ding your credit score, having too many hard credit inquiries generally has a short-term negative impact on your credit score, so you’ll want to consider the timing of your request.

3. Improve the length of your credit history

Only time can increase the actual age of your credit accounts, but there are steps to take to optimize the credit history you have.  

Review your credit report for errors 

Check for errors in your credit report. Your file might contain mistakes about how many credit accounts you have and how long they’ve been open. These or other errors could lower your credit score.  

Request a free copy of your credit report from — you’re entitled to one free credit report every 12 months from each of the major credit bureaus: Equifax, Experian and TransUnion.  

Check for any misspelled names or addresses, closed accounts reported as open, incorrect dates of last payment or delinquency, or other mistakes. You can dispute errors online, by phone, or by mail with the credit reporting agency. Alternatively, contact the company that provided the inaccurate information. Credit reporting agencies must investigate within 30 days and provide a written report, unless it finds your dispute frivolous.   

Avoid cancelling older credit lines 

It can make sense to keep an older credit card or revolving line of credit open, even after it’s paid off. You don’t have to close a paid-off account just because you’re not using it, and having long-established credit accounts is a positive for your overall credit score.

4. Diversify your credit mix and new credit factors

The different types of credit you have — your “credit mix” — determine a portion (10%) of your credit score by demonstrating your ability to manage multiple credit lines. The mix can include credit cards, retail store cards, installment loans, auto loans, mortgages, and more.  

While it wouldn’t make sense to open a bunch of credit cards just before buying a house, it is smart to think about your credit mix ahead of time, if you’re hoping to get a home mortgage down the road. Here are some ways to improve your credit mix:  

Apply for a secured credit card 

For those with thin credit files, a secured credit card can help establish a record of responsible credit usage and add to your credit mix. Getting one may require an initial cash deposit, such as $100 upfront to get a secured credit card with a $100 credit limit. As you use the card and establish a track record of on-time payments, your credit score will improve, and at that point you may want to transition to an unsecured credit card.  

Consolidate your debts 

If you’re dealing with an overwhelming amount of debt, seek help quickly to get it under control. Don’t hesitate to reach out to your creditors and explain your financial situation, as well as your sincere intention to work toward paying off your debts. They may offer some type of help, such as a lower interest rate. 

A debt consolidation loan may be an option to consider. Replacing a variety of high-interest debts with a single affordable, fixed-rate loan can simplify your debt management and reduce the total amount of interest you pay.  

Before making a move, it might be worth consulting with a nonprofit credit counseling organization through universities, military bases, credit unions, housing authorities, or the U.S. Cooperative Extension Service. A reputable credit counselor can help you develop a budget and a reasonable debt repayment plan, and can also help you apply for a debt consolidation loan. You can search for government-approved credit counseling organizations through the U.S. Trustee Program.

What credit score is needed for a mortgage?

Lower mortgage rates are generally reserved for applicants with strong credit scores. However, borrowers with a less-than-perfect credit score might get approved for a mortgage. Here’s a look at the minimum credit score requirements for the most common loan types: 

Loan program   Minimum credit score requirement 
Conventional loans  620 
FHA loans  FHA guidelines: 500-579 (with 10% down); 580 (with 3.5% down); lenders may have higher minimums 
VA loans  None set by the VA, but most lenders have their own minimums
USDA loans  640 (or alternative credit may be used)


Fixing up your credit history and boosting your credit score can take some time, depending on where your starting point is, but your efforts can boost your chances of a mortgage preapproval. 

If your credit needs serious rehabilitation, consider postponing your home purchase so you have time to organize your finances and clean up your credit. It can be helpful to start tracking your credit score regularly through a free credit monitoring service from a credit reporting company, such as Experian.

Credit repair FAQs

How long does it take to rebuild a credit score? 

Your credit score can change within as little as 30 days when you take concrete steps, such as disputing mistakes on your credit report or paying down a portion of your credit card balances. The amount of time until you see significant progress on boosting your credit score depends a lot on what type of negative information is in your credit report.  

Negative marks like late payments or accounts in collections can stay on your credit report for up to seven years, while a Chapter 7 bankruptcy can remain for up to 10 years.  

Is it possible to improve your credit by 100 points quickly? 

There’s no exact formula that’s guaranteed to boost your credit score by 100 points, but it’s possible to make significant improvements to your credit score, especially if you’re starting from a fair or poor score. One key step is to lower your credit utilization ratio as soon as possible, by paying off some of your credit card balances — perhaps with multiple, small payments — while keeping unused, zero-balance accounts open.   

Is it better to pay off a credit card in full or leave a balance? 

In general, it’s best to keep your credit utilization ratio below 30% of the total credit available to you. This signals to lenders that you’re in control of your budget and spending. Leaving a balance unpaid can cost you money, because your credit card company will start charging you interest on past-due balances.

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