Buying or Refinancing in 2026?

If purchasing a home or refinancing your mortgage is on your radar this year, your credit score should be front and center. In today’s rate environment — where every fraction of a percent matters — strong credit can help you qualify, secure a lower rate, and ultimately save thousands over the life of your loan.

1. Pay Every Bill on Time — No Exceptions

Payment history remains the top factor in your credit score calculation.

Just one 30-day late payment can cause a significant dip, especially if you’re preparing to apply for a mortgage. Set automate payments or digital reminders so nothing slips through the cracks.

2. Tackle Balances and Reduce Your Credit Utilization

• Using too much of your available credit signals risk to lenders.
• Aim to keep balances below 30% of your limits, and lower is better. Even small, steady paydowns can make a measurable difference by spring or summer.

3. Monitor Your Credit Reports for Errors or Fraud

You can request free reports from all three major bureaus each week at AnnualCreditReport.com.

Checking consistently helps you catch:

• Late payments
• Duplicate accounts
• Identity theft or unauthorized credit
• Disputing errors early helps protect your score before you apply.

4. Skip New Credit Until After Your Loan Closes

• Credit card approvals, car loans, and store financing all trigger hard inquiries and may temporarily lower your score.
• If a mortgage or refinance is coming, press pause on new accounts and let your history continue working in your favor.

5. Preserve Older Accounts

• Length of credit history still counts.
• Closing long-held cards shortens your profile and can increase utilization overnight. So keep older accounts open when you can — especially those with no annual fees.

6. Postpone Major Purchases and Big Debts

Large new loans can change your debt-to-income ratio, which lenders analyze closely in today’s tighter lending environment. If it’s not urgent, wait until after closing day for car upgrades, personal loans, or furniture financing.

Whether you’re gearing up to buy a first home, upgrade your space, or refinance for better terms, your credit score plays a crucial role. Maintaining consistent, careful credit habits today can put you in a stronger position to unlock better rates, lower payments, and more lending options — whenever you’re ready to make your move in 2026. Source