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Buying your first home is exhilarating — and expensive. Before you begin your search, it helps to know where you stand in terms of credit rating, as your lender will be looking closely at your down payment, your income and your credit history to determine how much you are qualified to borrow and at what interest rate. The worse your credit is, the more your mortgage will cost you in terms of a higher interest rate. Cleaning up your credit before you buy can save you thousands in interest costs. (Back to glossary of common credit card terms
Glossary terms to know when buying a house
Annual percentage rate (APR) — The annual percentage rate (APR) is the interest rate … (more)
Available credit — Available credit is the amount that is available to be charged to … (more)
Balance-to-limit ratio — Balance-to-limit ratio is used in the calculation of credit scores … (more)
Consumer credit file — A consumer credit file is the collection of an individual consumer’s … (more)
Credit bureau risk score — A credit bureau risk score is a snapshot of a person’s… (more)
Credit history — Credit history is the record of use of debt. In the United States, three … (more)
Credit score — A credit score is a three-digit number that summarizes how well … (more)
Credit utilization ratio — A credit utilization ratio is used in the calculation of credit … (more)
VantageScore — A credit score product launched in March 2006 by the three major … (more)
See related: Glossary of common credit card terms, House of cards: Charging mortgages idea fails, Credit card cash advances for home down payments?, Keeping credit scores clean before you close on a home, Inheritance strategy: Pay off mortgage or credit cards?, Study shows recent mortgage, delinquency go together, What VantageScores are, how they work, More landlords accepting rent payments by credit card, Manage your credit cards before, during and after a move