Your health, protecting your family, and providing the basic household needs were priorities during the pandemic. As officials lift mandates and people shift back to their lifestyle, we are now reminded to stay diligent in maintaining financial health. The summer months have started with strong buyer demand with active bidders leaving many questioning their financial ability to buy in a competitive market. With so many households having dipped into their savings, rebuilding their financial security and stability is an added milestone before a new home search begins

 

Credit Reports 

Reviewing your credit report is a great place to start when it comes to unraveling the financial setbacks post-pandemic. Gusto surveyed 540 small business workers and found that employees took on an average of $3,351 in new debts. Changes in debt-to-credit ratio, late payments, and hard inquiries for new loans result in lower credit scores. Accessing your credit scores will give you a better understanding of your buying power and what areas need improving. Take advantage of getting a free credit report from each of the three credit bureaus: Equifax, Experian, and Transunion.

Fix Mistakes 

1 in 5 credit reports will have mistakes. Addressing errors and resolving any mistakes is the quickest way to improve your credit score. Contact your Lenders Still can’t pay all your bills at this time? Contact your lenders and ask about hardship options. Many lenders still have policies in place to help customers who need extra time to make payments due to hardships endured from the pandemic. Lenders may be able to temporarily lower your interest rate or payment amount, or pause your payments for a period of time. Lenders may also be able to place your loans in deferment or forbearance. You don’t need to make payments when a loan is in deferment or forbearance, and the lender will not report late payments to the credit bureaus. Additionally, an account being reported as in forbearance or deferment will help minimize the impact on your credit score if the account is in good standing with no previous reported delinquencies.

Do Not Close Those Accounts! 

Tempting as it may be, don’t close credit cards you don't use. The length of time you have had credit is a factor in your score; experts recommend keeping a card and using it occasionally and pay it off on time in full each month. be prepared for the temporary hit on your score if you find yourself having to cancel any accounts. 

Little Score Wins 

There are tools such as the Perch Credit app, Experian Boost, and programs like Chime that increase your credit score by with every day recurring expenses, such as your electric bill, to show the bureaus your ability to habitually pay on time. These little wins score big points in the long run.

Be Proactive 

With a little strategy, you can rebuild your financial health, improve your score, and increase your sense of financial security. Before you know it, you’ll be on a search for that new perfect home. As officials lift mandates and people shift back to their lifestyle, we are now reminded to stay diligent in maintaining financial health. The summer months have started with strong buyer demand with active bidders leaving many questioning their financial ability to buy in a competitive market. With so many households having dipped into their savings, rebuilding their financial security and stability is an added milestone before a new home search begins. With a few of our pointers, you'll be back on track.