First-Home Q&A #10: Why Credit Has to Be Prepared Now

First-time buyer programs like MassHousing’s assistance generally look for a credit score of roughly 640 or above. If you missed this round, there is something to do now for the next one.

Why programs check credit first

Because it cannot be raised at the last minute. Paying off one card does not move the score the next day; it shifts gradually over months. Starting when the deadline is in sight is too late, so the preparation is for the next round, and it starts now.

If your US credit history is short rather than damaged, the situation is different — see buying without a long US credit history first.

Four mistakes that lower a score

1. Late payments — a single one stays on the record for a long time.
2. High card utilization — a large balance relative to the limit works against you.
3. Several applications in a short period — each new card or loan adds an inquiry.
4. Closing old accounts — it shortens the length of your credit history.

What to do now

First, pull your own credit report and check it for errors. Points are sometimes lost to a misreported item, not a real mistake.

Then, in order: pay down card balances to lower utilization, hold off on new cards or loans, and keep existing accounts open. The difference shows up plainly at pre-approval a few months later.

Which program is realistic given where your credit stands is something I will go through with you.