Profile picture for trurican0126

credit cards

Should all my credit cards have a zero balance before i start looking for a home?
  • October 15 2013 - Homestead
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Answers (5)

Profile picture for Chris Boyles
I have talked to a lot of different lenders about this and they say that having a 25% balance on the card is ideal to see.  They want to see that the accounts are active and having a balance of this amount will help build your credit score in a timely manner.
  • October 16 2013
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You can get a lot of advice on credit scores FREE on the internet. Having a zero balance is NOT the best way to improve a score.  It may lower your score.

Your score is based in part on how much available credit you HAVE NOT USED. Regular monthly and timely payments.

Recommendations are that you keep your CC balance under 1/3 of the credit limit.  A $300 card no more than a $100 balance.

The way the scoring system works is they want to see that you making payments every month like a robot.
  • October 16 2013
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Not typically. Credit cards are meant to be used as revolving credit and lenders will want to see a pattern of using the credit card and paying the credit card debt on a regular basis. Any particular loan will be dependent on your income to debt ratio, and also your income to expense ratio. Given this, it is best to discuss your particular case with a local lender, who can discuss your options and advise you on ways to improve your credit.
  • October 15 2013
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The less debt you have the better it will be for you. Lenders like myself look at many different factors including your income, credit score, debt, employment, down payment, expenses, assets, liabilities, etc. All of these things are collectively looked out to determine whether or not you qualify for a loan and how much you qualify for. So as I mentioned the less debt the better, but you don't want zero activity on your credit either. This will be the most efficient and quickest way to figure out whether or not you qualify for a loan. There are lenders like myself that would be glad to speak with you, to help you get the loan that you need. So if you have any other questions or need a loan, please contact me through the information on my profile page. I hope this helps and good luck!
  • October 15 2013
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You will need to call a lender to find out the answer to your situation.  Having a zero balance on a credit card lowers your debt to income ratio, which helps your chances of getting a home.  However, not having recent activity on any of your cards can sometimes hurt your credit score.  Again, call a lender.
  • October 15 2013
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