Credit Advice for the New Homeowner

If you are a new homeowner, you could probably use some credit advice about how to make it all work. Owning a home takes a lot of work. There are many unexpected expenses that always seem to creep up. Managing your credit and debt is something that every homeowner should be concerned with. Here are a few tips to help you manage your finances.

Watch Your Score

Before you own a home, you are probably aware of your credit score. However, once we make the big purchase and buy the house, we come relaxed and stop guarding our credit so diligently. We begin to think that we already have the house, so why bother with protecting our score any further? While this is common, you should not allow this illogic to affect you.

Even though you just bought your house, the likelihood of you staying in this house for the rest of your life is not very high. Most people move around to different houses and even different cities. Therefore, this house purchase could be the first of many. You need to protect your credit rating just as you did before you bought the house because you will undoubtedly need it again.

Avoid Credit Card Debt

The most common way that homeowners get into trouble is through the over-use of credit cards. Credit cards have high and leaving balances on the cards is a sure way to hurt your financial situation. With the expenses that come with a new house and with life in general, we are tempted just to charge it and worry about it later. Make it a priority that you will not fall into this trap. If you do not have the money for the item, do not buy it. Wait until you can afford it. You should still have a credit card and use it wisely. However, you should only use it if you will have the money to pay it off when the bill comes due.

Pay Bills on Time

One of the most important things that you can do to protect your credit is to pay all of your bills on time. Many people get bogged down with life and forget to make the payments on all of their bills on time. A very large percentage of your credit score is determined by how timely you pay your bills. Therefore, you should make it your number one priority. If you miss payments or continually make late payments, your credit score will fall.

The best thing you can do to protect your credit is create a budget and a monthly payment schedule. Once the budgeting schedule is in place, you do not have to spend too much time paying bills every month. Give yourself 1 hour for bills due before the 15th and another hour for the bills that are due after the 15th.

Do Not Over-Improve

Many homeowners over-improve the home they purchase. Improvements should be completed in moderation. If you are racking up huge loans in order to improve your house, you might want to stop and consider why you are doing it. Consider only living repairs first. Then, get a feel for a house and live in it before you complete other repairs.

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