Do You Know Your FICO?

Before you start looking to buy your first home know that the key to better interest rates is having the right FICO score. FICO is your credit score, it's what all lenders check out before deciding whether or not to loan you money and what your interest rate will be.

To improve your FICO score:

1. Keep your credit card balances below 30 percent of their limits. If you can't pay off your debt in full then spread it over a few cards with low balances rather than maxing out one.
2. Don't close your oldest account. The length of your credit history helps to determine your FICO score. So keep the card you have had for years, pay it off but don't close the account.
3. Wait at least six months between credit applications. Opening several cards (even store cards count) or lines of credit within a short period of time also hurts your FICO score.
4. Always make your payments on time. Payment history makes up 35 percent of your score.

What is Home Equity? and why is it important?