5 Simple ways to Protect and Increase Your Credit Score

Happy Friday, I hope you and your family are doing well! 

One of the most common questions I receive from clients is “how can I improve my credit score”?  For this reason I have listed below five simple ways to protect and improve you credit score.

Five simple ways to protect and increase your credit score:

1.      Pay your creditors on time.  A significant portion of your credit score is weighted on your payment history.  Mortgage credit history is weighted the highest due to the size of the loan.

2.      Keep credit card balances below 50% of the credit card limit.  As an example, if your credit card limit is $1000 your credit card balance will be below $500 or less.  The lower the balances the better.

3.      Limit the amount of charge cards and loans.    Excessive open credit cards with balances and large amounts of installment debt (ie auto loans) will reduce or limit your credit score from increasing.

4.      If you are applying for a loan limit the amount of credit inquiries made.   Each time you apply for a loan the bank or lender will complete a credit inquiry. Too many credit inquiries in a short period of time may reduce your credit score.

5.      Avoid co-signing for loans.  Co-signing for a loan means you take on the risk the lender does not want.  The person who has applied for a loan does not qualify and the lender is requesting for additional support from a co-signer.  When you co-sign for a loan you become equally responsible for the loan repayment and your credit score will be impacted as mentioned in above #1-4. 

In conclusion, I use the analogy of your credit score being similar to having children.  Your credit score will be with you until you die (so will your children) and effort must be made to make sure your credit score is protected and conditioned.  Neglecting your credit can cost you thousands of dollars when and if you decide to obtain a mortgage loan.

If you have any questions or would like more information on credit or maybe thinking of purchasing a home or refinancing your home please feel free to contact me. 


Ed Smith

Relearn, Release, and Receive

In this blog I would like to share some things I am doing to remain competitive in our mortgage business and position ourselves for growth.

Relearn professional skills.  Relearning professional skills such as focusing on our vision“Making Dreams Come True” enables us to stay focused and use our resources wisely.  We provide great customer service and very good interest rates while developing a relationship with our clients.

Release responsibilities to others in order to focus on our vision, marketing strategy and things we excel in will enable our business to position ourselves for success and align our business closer to our customer base and realtors.

Receive the fruit from our labor.  Through hard work, intentional changes, and staying the course in our plans will result in fruit from happy customers, increase revenue and a stronger company. 

“Life is 10 percent what happens to you and 90 percent how you react to it.”

-Charles Swindoll-

Positioning Yourself for Success

I recently completed a loan interview with a couple desiring to purchase a home, however, they did not know how to prepare to be qualified borrowers.  This made me realize how postioning ourselves now will result in reaching our goals and being successful.

The homebuyers wanted to position themselves now to be able to successfully purchase a home.  How can this be accomplished?  I suggested setting up short term goals such having consistent income and employment history, paying their credit cards down, and paying off any loans as well as preparing for a down payment by saving money and not taking unnecessary deductions.

Although this may take time and work, the couple will have a plan and a goal which will enable themselves to position themselves for success.

By the way, this is my second blog and I wanted to introduce myself. My name is Ed Smith and I am currently a mortgage broker (NMLS 327781) at Solid Rock Home Loans, in Honolulu, HI (NMLS 327781).  I have been in the mortgage business for approximately 20 years and hope my blogs help you in the ever changing world of mortgage lending.



Educate yourself on Home Equity Lines of Credit (HELOC)

In the past  year there have been an increased popularity of Home Equity Lines of Credit or HELOC.  The primary reasons why the HELOC has gained popularity are: 1)increased revenue for banks as HELOC terms can be tied to Adjustable Rate Mortgages, 2) improved home values and stringent loan underwriting have enabled HELOC to become a “safer” product for banks, 3) and the improved economy has enabled consumers to look at alternative financing for home improvement, student loans, and large consumer purchases.

HELOCs are essentially large credit cards with a credit limit  which can be charged or drawn upon and paid back within the loan terms.  Each time the HELOC is drawn upon interest is charged.  Some HELOCs are advertised with a very low interest rate which can increase or adjust to a higher normalized interest rate.

Educating yourself with any loan will enable you to know the benefits and costs.  The HELOC can be a complex loan program as some features include multiple draws and repayment plans, fix rate option, interest only option, early termination fee, and the index and margin the interest rate will be tied to determine your Annual Percentage Rate.

Please add you comment on HELOCs.