How to Boost Your Credit score When Looking for a SA Home Loan

SA Home Loans: When looking for a home loan it is important to try to increase your credit ranking. In general, the better your credit standing, the more beneficial credit terms you'll get.

When you have had a low credit standing you'll be at the mercy of the banks who will be able to charge you interest rates way above prime.

Fix Errors On the Credit reports

The two biggest credit agencies in South Africa namely, Trans Union and Experian. So the first thing you should do is to get a free credit report and search for for errors in your record. You should act right away to get it fixed, because if you apply for any kind of SA home loans your lender isn't just going to take your word for it that there are mistakes on your credit report.

You should not Apply For Debt When Applying For SA Home Loans

Do not make the mistake of running around and applying for credit cards or car financing until after your home loan is approved. Remember that looking for new credit temporarily brings down your credit score.

Pay Your Debt That's Near The Limit

Credit balances which are over 50% of your credit limit brings down your credit score. In general, try and keep balances below 50% but for optimum benefit try to keep balances below 30% .

To put it differently, if your credit limit is R10, 000, attempt to bring the balance right down to R3, 000. This will help to boost your credit score. Your credit score will increase immediately once your balance is decreased.

For the best results one could clear your credit card debt in full each month. However, don't close your accounts, since that may lower your credit score. What’s key here is the % of your total credit which you're using. The lower it is the better.

Pay Your Accounts on Time

Please don't make late payments. Paying your bills before its due is one of the simplest ways to increase your credit standing. It shows the bank that you take your responsibilities seriously and that they can expect to be paid on time also if they grant you mortgage finance.

So, its not that impossible to give your credit rating a boost, but the biggest thing is that you have to take steps .