Jay Allen - REALTY EXECUTIVES Boston West | Framingham, MA Real Estate, Natick, MA Real Estate

A house is a personal statement for many people. It lets neighbors, relatives and friends know what you value. Buy a house in a thriving community and you could convey to close associates and passersby that you're a positive thinker who is serious about her current and future success. But, getting the keys to a great house in a thriving community at low interest rates is not as simple as house hunting for days, weeks or months.

Bad credit is an early step toward home mortgage regret

Securing a quality mortgage on a house in a good community requires you to have more than a job, especially considering that many mortgage lenders continue to be watchful about borrowers' financial readiness. To get a good mortgage on a house in a thriving community, you need strong credit scores.

Low credit scores do more than hurt your chances to secure a mortgage at the best interest rates. Work your way to low credit scores and you may pay more for:

  • Furniture that you buy on credit - Even if you get furniture through a delayed payment plan, you could be denied credit if your credit scores are too low.
  • Utilities - It doesn't always come to mind, but credit scores can also impact utilities. If utilities remain high for a year or longer, low credit scores could cause you to pay hundreds more a year than you would have paid if your credit scores were higher.
  • Homeowners insurance - Like utilities,homeowners insurance is generally a charge that must be paid monthly. High monthly homeowners insurance premiums could limit your ability to meet your rent should you have an adjustable rate mortgage and your mortgage goes up after you move into your house.

It bears repeating that low credit scores can make the difference between whether or not reputable lenders award you a fixed or an adjustable mortgage. Let something go wrong at your property that requires the focus of a licensed contractor like a plumber or electrician and you could pay more for repairs. Clearly, low credit scores put a lot of weight on more than where you live and what type of house you live in.

Good and bad credit habits start early

As soon as you make your first credit purchase, the clock starts ticking on your credit score development. When you take on revolving financial responsibilities like heating, cooling, water and electricity services, you also start to determine your credit score.

Your financial decisions may not leave much of an impression on you during your high school or college years. But, they will when you decide to buy a house. Develop the habit of making bad financial decisions and you could generate a low credit score.

It could take six months or longer to raise your credit score high enough to secure a great fixed mortgage with low interest rates. A low credit score could also force you to give in and buy a house in a declining or developing neighborhood.