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How long does it take to have a credit good enough to buy a home?

Posted on November 28, 2018 by Ali Asi

How long does it take to improve your credit score? If you're hoping to buy a home, having a good credit score is key, since it helps you qualify for a mortgage. So if your credit score is low, knowing how long it takes to raise it to home-buying range can help you plan. While raising a credit score can't happen overnight, it is possible to raise your credit score within one to two months. However, it could take longer, depending on what's dragging down your score and how you handle it. Here's what you need to know.

How long does it take to raise a credit score?

What's considered a good score versus a poor one? Gernerraly speaking credit score is a number between 300 to 900. And, these are the range of numbers and their interpretations:

Perfect credit score: 850-900
Excellent score: 760-849
Good credit score: 700-759
Fair score: 650-699
Low score: 600-650
Very poor score: 300-600

While it varies by area and type of loan, generally lenders will look for a score of 660 or higher to grant a mortgage.

If you’re looking to boost your credit score fast, here are some actions you can take.

How to get your credit report and score

There are in total 3 main credit report agenecies: EquiFax, TransUnion and Experian. You can go to the websites of any of these agencies and order your credit report to be mailed to you, free of charge. Howver, if you want to get a copy of your credit score, in addition to your credit report, you have to pay a nominal fee, ranging from $14-$30.

Fortuntely, there are two alternative free ways to do this:

- CreditKarma is providing an excellent free servce which gives you access to your credit report and score. The caveat is that you have to put up with some advtersiment banners around your screen. Also, I have found the report formatting is not as organized as the one you can get from Equifax, but it will still do the job. In addition to being free, this site has couple of additional advantges. First of all, it will update your score once a week. Secondly, it has an amzing mobile app, which is something always missing from the other agencies.

- Royal Bank of Canada and Bank of Nova Scotia have recently added this free complementary service to their clients which will give them the same free access as CreditKarma does.

Once you have received your cresit report, try to read each item very carefully and try to identify any errors or even accounts which you do not recognize.

Correct errors on your credit report

Correcting errors on your credit report is a relatively quick way to improve your credit score. If it’s a simple identity error, like a credit card that’s not yours showing up, you can get that corrected within one to two months. If it’s an error on one of your accounts, though, it could take longer, because you need to involve your creditor as well as the credit bureau. The entire process typically takes 30 to 90 days. If there’s a lot of back-and-forth between you, the credit bureau, and your creditor, it could take longer.

Next, review them for errors. If it’s an error on one of your accounts, you must refute that error with the bureau by providing documentation arguing otherwise. For example, if you paid a credit card on time and the card issuer is reporting a late payment, find a bank statement showing that you paid on time. Credit bureaus typically have 30 days to investigate the error. If they agree that it’s an error, they will remove the item. The credit bureau may also ask for additional information or ask you to discuss the information with the creditor involved. If that’s the case, stay on top of communications with your creditor so you can get things resolved as quickly as possible.

Deal with delinquent accounts

Bringing delinquent accounts current and settling accounts that are in collections can also boost your score fairly quickly. Once the creditor or collection agency reports your account update, you should see a positive bump in your score. Keep in mind, though, that your late payment history will remain on your credit report for seven years. If you have bad accounts that have been on your report for six years or more, you may not want to worry about settling them or bringing them up to date. This can re-age the account, and if you fall behind again, it will stay on your credit report for another seven years. Make sure you don’t re-age these accounts, because they’re going to drop off soon. Negative information typically “falls off” your credit report after seven years, so if you're close, it’s best to just wait it out.

Lower your credit utilization

Credit utilization refers to how much you owe compared with the amount of credit you have available. For example, if you have a $10,000 credit limit across all your credit cards and you have balances totaling $9,000, you’ve utilized 90% of your credit. This drags down your credit score. What you need to do is pay down the balances on your existing credit accounts, which can be a challenge if you've allowed the balances to creep up over time. The ratio of what's owed to the amount of credit available represents 30% of your score, so rapid improvement is possible if there's a large amount of money available to pay down balances.

Next, try paying down balances to below one-third of your credit line. Any payments you make will be reflected on your credit report as soon as your creditors report your payment to the credit bureaus. Credit scores are updated on an ongoing basis, and creditors typically report once per month, so if you make a payment that lowers your credit utilization, that should be reflected on your credit score within two months.

If you’re regularly using your credit card but you want to keep your utilization low so you can apply for a mortgage, you may want to pay down your credit-card balance on a weekly or biweekly basis. This ensures that your balance is as low as possible whenever your creditor reports your payment history to the credit bureaus.

You can also decrease your card utilization by getting more credit, but this approach can backfire. Consumers sometimes assume that by getting more credit, their credit score will improve. If you have a $3,000 balance on a card with a $4,000 credit limit and you're approved for a new credit card with a $1,000 limit, you now have $5,000 in total credit lines. Instead of using 75% of your available credit, you're now using 60%. That's better, right? Not necessarily. Just applying for credit lowers your credit score, and that effect lasts for months. For the first few months after you apply for credit, your credit score may actually go down.

You can try getting around this by asking a credit limit increase on a card you already have. Be sure to ask whether they do a “soft” credit pull rather than a “hard” credit pull, though, since hard credit inquiries are the ones that impact your credit. A creditor may be willing to give you a credit line increase with a “soft” pull, which will not hurt your credit score.

Soft inquiries are for background purposes only. For example, a credit card company may do a soft pull to see if you're eligible for certain credit card offers, or an employer may do a soft pull before offering you a job. Soft pulls can be done without your permission and do not impact your credit score. Hard pulls require your permission, and are done when lenders or credit card companies are assessing whether to grant you a loan or line of credit.

How to raise your credit score for the long haul

Once you’ve corrected errors, settled your delinquent accounts, and brought your credit utilization under control, the only other things that will improve your score are time and developing good payment habits. For example, if you tend to forget to make payments, you can set up automatic payments so you don’t forget.

And here's some good news for people with bad credit: Generally, people with the lowest scores will see the biggest gains the fastest. Improving your credit score, is a lot like dieting. For instance, if your score is 550, you could probably get it up 30 points in a matter of a couple months, if you’re really dedicated and really careful. On the other hand, If your credit score is already a 750 and you’re trying to get it to 780, that can take double or more the time. Still, it's worth doing whatever you can to get the best interest rate possible.

Ali Asi | 604-785-8900 | info@aliasi.ca | Royalty Group Realty

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New property listed in Westwood Plateau, Coquitlam

Posted on November 22, 2018 by Ali Asi

Posted in Westwood Plateau, Coquitlam Real Estate

New property listed in Westwood Plateau, Coquitlam

I have listed a new property at 304 3178 DAYANEE SPRINGS BLVD in Coquitlam.

See details here

Situated at the base of Westwood Plateau w/every urban & natural amenity at your doorstep, you'll find Tamarack - Polygon's newest collection of apartment residences in the sought-after master-planned community of Dayanee Springs. This 2 bedroom CORNER UNIT w/stunning MOUNTAIN VIEWS features over 1000 sq ft and reflects a modern take on Whistler-inspired architecture with an open plan layout & the latest in contemporary finishes such as granite countertops, warm laminate flooring, garburator & sleek S/S appliances. Tamarack residents will also benefit from a private resident-only clubhouse featuring over 7500 square feet of resort-style amenities. BONUS! 2 side-by-side parking stalls & 1 storage locker. Don't miss out on this one!

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New property listed in North Coquitlam, Coquitlam

Posted on November 22, 2018 by Ali Asi

Posted in North Coquitlam, Coquitlam Real Estate

New property listed in North Coquitlam, Coquitlam

I have listed a new property at 1903 2979 GLEN DR in Coquitlam.

See details here

ALTAMONTE' built by BOSA w/ South East facing Mountain & City viewed excellent unit. 1,230 SF, 3 bedroom, 2 bathroom, 2 parkings & 1 storage locker. New hardwood flooring, new paint w/ S/S appliance, granite countertop. Ideal investment property or self use. Close to skytrain station, Coquitlam Shopping Mall, Douglas College, Westcoast Express. YOU WIIL LOVE IT!! DO NOT MISS IT!!

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New property listed in Victoria VE, Vancouver East

Posted on November 12, 2018 by Ali Asi

Posted in Victoria VE, Vancouver East Real Estate

New property listed in Victoria VE, Vancouver East

I have listed a new property at 3475 COMMERCIAL ST in Vancouver.

See details here

Top quality retail/office commercial property at 'La Villa' in central location, situated on Commercial Street. Buyer to verify measurements.

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Open House. Open House on Sunday, November 4, 2018 2:00PM - 4:00PM

Posted on November 2, 2018 by Ali Asi

Posted in Lower Lonsdale, North Vancouver Real Estate

Open House. Open House on Sunday, November 4, 2018 2:00PM - 4:00PM

Please visit our Open House at 638 FORBES AVE in North Vancouver.

See details here

Open House on Sunday, November 4, 2018 2:00PM - 4:00PM

OPEN HOUSE: SUN., NOV. 4, 02:00-04:00 PM. BEST DEAL in town. ***$230K BELOW B.C. Assessment*** This immaculate, stunningly beautiful half duplex has been tastefully upgraded. No Strata fees or Strata rules. Offers a spacious living room and a formal dining, 9' ceilings, laminate floors w/radiant heat throughout. Gourmet kitchen w/ granite countertops, backsplash, maple cabinets, new S/S appliances & a family room opening to a deck w/ sliders. 3 bdrms up, including a large master with walk in closet & balcony w/view. A multi-purpose hobby room (or bedroom) on the lower level and a large crawl space for additional storage. Fully fenced landscaped yard, one car garage, wrap around sundeck, irrigation system & so much more to list. Close prox. to Schools, Parks, Transit & Shopping.

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Open House. Open House on Saturday, November 3, 2018 2:00PM - 4:00PM

Posted on November 2, 2018 by Ali Asi

Posted in Lower Lonsdale, North Vancouver Real Estate

Open House. Open House on Saturday, November 3, 2018 2:00PM - 4:00PM

Please visit our Open House at 1003 110 4TH ST W in North Vancouver.

See details here

Open House on Saturday, November 3, 2018 2:00PM - 4:00PM

OPEN HOUSE: SAT., NOV. 3, 02:00-04:00 PM. OCEAN VIEW. CONCRETE BLDG 1 bedroom/1 bath at LOLO is the perfect place for first time buyers or savvy investors. Solid concrete bldg. with a gym, tennis courts, party & billiard room. This unit comes with 1 parking and 1 locker. Watch the sunrise from your living room, balcony or your bedroom and enjoy all the amenities Lower Lonsdale has to offer: Convenient location, close to Seabus Station and 5 mins to Central Lonsdale, Lions Gate Hospital, Rec Center, City Hall, etc. Do the math and stop renting or start investing! Recent unit update: New Stainless Steel Appliances, complete overhaul of kitchen and bathroom, new paint and flooring. Recent building update: Brand new Elevators. Investor Alert: “RENTALS ALLOWED.”

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New property listed in Lower Lonsdale, North Vancouver

Posted on November 1, 2018 by Ali Asi

Posted in Lower Lonsdale, North Vancouver Real Estate

New property listed in Lower Lonsdale, North Vancouver

I have listed a new property at 638 FORBES AVE in North Vancouver.

See details here

BEST DEAL in town. ***$230K BELOW B.C. Assessment*** This immaculate, stunningly beautiful half duplex has been tastefully upgraded. No Strata fees or Strata rules. Offers a spacious living room and a formal dining, 9' ceilings, laminate floors w/radiant heat throughout. Gourmet kitchen w/ granite countertops, backsplash, maple cabinets, new S/S appliances & a family room opening to a deck w/ sliders. 3 bdrms up, including a large master with walk in closet & balcony w/view. A multi-purpose hobby room (or bedroom) on the lower level and a large crawl space for additional storage. Fully fenced landscaped yard, one car garage, wrap around sundeck, irrigation system & so much more to list. Close prox. to Schools, Parks, Transit & Shopping.

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