Your Credit Score, Explained

Your credit score is the first thing a lender looks at and the easiest thing to misunderstand. It's not a judgment of you — it's a statistical snapshot of how reliably you've handled borrowed money. Here's what actually moves it.

What a credit score actually is

Most lenders use FICO scores, which run from 300 to 850. Higher is better. As a rough map: scores in the 670s and up are generally considered good, 740 and above very good — and FHA-based programs can work with scores in the 600s. Each program sets its own minimum, so the number that matters is the one on your program's matrix.

What builds (or breaks) it

Five ingredients, roughly in order of impact:

• Payment history — the heavyweight. One 30-day late payment can cost you dearly.
• Amounts owed — especially credit card balances relative to their limits. High utilization drags scores down fast.
• Length of history — older accounts help. That card from college is doing quiet work.
• New credit — each application can shave a few points; several at once looks risky.
• Credit mix — responsibly handling different types (cards, installment loans) helps a little.

Five practical ways to raise it

1. Pay everything on time, every time. Set autopay for at least the minimums — this single habit matters most.
2. Pay down card balances. Getting utilization under 30% of each limit helps; under 10% helps more.
3. Don't close old cards. Closing one shortens your history and spikes your utilization ratio.
4. Pause new applications. No new cards, car loans, or furniture financing while you're mortgage shopping.
5. Dispute errors. Wrong late payments and accounts that aren't yours are common — and fixable.

Get your free reports

You're entitled to free credit reports every week from each bureau at annualcreditreport.com — the only official source. Review all three; errors are surprisingly common and disputing them costs nothing.

How long does improvement take?

Honestly: months, not days. Consistent on-time payments and lower balances compound over 3–6 months. Anyone promising an overnight 100-point jump is selling something — real improvement is boring, steady, and free.

What lenders actually pull

When you apply, the lender typically pulls your credit from all three bureaus — Equifax, Experian, and TransUnion — and works off the middle of the three scores (not the average, not the highest). If you're applying with a co-borrower, the lower of your two middle scores usually drives the pricing. That's why both applicants' credit matters, and why checking all three reports — not just a free app showing one — is worth the effort.

One more thing: that pre-approval pull is a hard inquiry and may nick your score a few points. It's normal, expected, and far less damaging than the myths suggest. What does hurt is scattering applications across cards and auto loans in the same month.

Credit mistakes to avoid while house hunting

• Don't co-sign anything. Their loan becomes your debt in the lender's eyes.
• Don't max out cards "temporarily." Even one high-utilization month can drop your score right before the final pull.
• Don't dispute everything at once. Legitimate errors? Dispute them. But mass-disputing accurate negative items can backfire and stall your file.
• Don't close your oldest card to "simplify." Simplification can wait until after closing.
• Don't take on "no payments for 12 months" deals. The debt still counts, and the payment shock later is real.

Treat the months before your purchase like a quiet period for your credit: pay on time, keep balances low, change nothing. Boring wins — and when your score crosses into the next tier, programs and pricing both get friendlier.