How to boost low score to qualify for a mortgage

To Her Credit columnist Sally Herigstad
Sally Herigstad is a certified public accountant and the author of "Help! I Can't Pay My Bills: Surviving a Financial Crisis" (St. Martin's Press, 2006). She writes "To Her Credit," a weekly reader Q&A column about issues involving women, credit and debt, for, and also wrote for MSN Money, and, and has guested on Martha Stewart Radio and other programs.

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Question Dear To Her Credit,
My boyfriend and I are looking to buy a house within six months. Unfortunately, his credit score is at 613 because of a missed a payment a few months ago. Our bank had told us his score needs to be 640 or higher to be able to qualify for a loan.

Do you have any suggestions for how we can raise his credit score at least 30 points in a few months? Thank you for your time! – Britta


Dear Britta,
I often talk to people who want to raise their credit score by next month, if not sooner. That’s a little hard to pull off. In six months, however, your boyfriend should be able to raise his score significantly.

Preferably, he should aim for raising his score more than 30 points. A credit score of 640 may be the minimum, but it won’t get you the bank’s best rates. Let’s hope he can raise it closer to 700, at least.

If he doesn’t have any other types of credit besides credit cards, there is an option he may want to consider. He can become an authorized user on a family member’s card account that has a high credit limit, low debt and a long record of on-time payments. As an authorized user, the history of that account will appear on his credit reports, and being added as an authorized user won’t result in a hard pull of his credit.

If a family member has a card account that meets these specifications, you may want to add him to that card. Just know that the primary account holder is ultimately responsible for any charges your boyfriend adds to the account. To be on the safe side, he probably shouldn’t use the authorized user card, since he doesn’t have to use the card to get the account history reported on his credit reports.

In the meantime, knowing how credit scores work is key to improving his credit as quickly as possible. These are the five general categories used in calculating FICO scores, the most commonly used credit scores, and here’s what your boyfriend can do to improve the way his credit report affects each one:

Payment history. The largest category that determines your credit score is payment history. This is where your boyfriend is getting hit with a negative mark for a missed payment a few months ago. However, one missed payment can’t be the whole problem, because the entire payment history category affects only 35 percent of a credit score.

The best way to improve your payment history is to build a perfect payment record, starting today. Your boyfriend may consider setting up automatic payments for minimum credit card payments, if he always has enough money in his account to cover them. That’s one surefire way I know to get a 100 percent blemish-free payment history.

He should also read over his credit report carefully (he can pull them for free once a year from each of the big three credit bureaus at If he finds erroneous negative marks, he should dispute them.

Amounts owed. This is the percentage of available credit on a credit card (and across all your boyfriend’s credit cards) when the banks report to the credit bureaus. For example, if he has a credit limit of $10,000, and owes $7,500, he’ll show a credit utilization ratio of 75 percent. Paying down or paying off debts will dramatically improve his credit utilization. His score would improve if he could decrease the amount he owes to near zero.

Another way your boyfriend could improve his credit utilization is to increase his credit limit. He could call his card issuer to ask for a credit limit increase, but with that late payment, there’s no guarantee the issuer will grant his request. However, if he has otherwise been a good customer for a long time, it may be worth a try. But if he’s had more than one late payment, I wouldn’t suggest it.

Contrary to some mistaken beliefs, a person doesn’t need to owe a balance to have a great credit score. If the banks report that he doesn’t owe anything on his credit accounts, he’ll do just fine.

The amounts owed ratio accounts for 30 percent of his credit score.

Length of credit history. The longer you’ve had accounts, the better it reflects on your score. This is a difficult category to pull up quickly, because it’s just a matter of having accounts and keeping them for a long time. The best your boyfriend can do is avoid closing his oldest accounts and making things worse. Getting new cards also can negatively affect a person’s length of credit history, by lowering the average account age.

Fortunately, length of credit history accounts for only 15 percent of a FICO credit score.

New credit. It’s important not to open many new accounts close to the time you need your credit score to look its best. Applying for credit causes a slight ding to your credit score that lasts about two years. It’s temporary, but it can be just the wrong thing at a crucial time, such as seeking a mortgage. New credit accounts for 10 percent of a FICO score.

Credit mix. Prospective creditors like to see a mix of credit types in someone’s history. A good mix might be a retail account or two, a car loan or other installment account, and a credit card. Credit mix accounts for the last 10 percent of one’s credit score.

I wouldn’t recommend taking out a loan, however, just to improve a credit score. If your boyfriend is, for example, buying a car anyway, he might do well to buy a very reasonable car with low payments, and pay the car off as quickly as possible. Be aware that banks don’t just look at credit scores when they process loans. They also consider your income and how much you are already committed to in monthly payments. Large car payments could make it harder for him to qualify for a mortgage, not easier.

Knowing how credit scores are calculated can help your boyfriend plan to have a better score in time to qualify for that home loan so the two of you can take this important financial step together.

See related: Small credit line? Pay early to boost credit score

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Updated: 11-19-2018