When you’re preparing to buy a home, your credit score isn’t just a number—it’s one of the biggest factors in what you’ll qualify for, how much you’ll pay, and even how quickly you can close. The difference between a “good enough” score and a strong one can add up to tens of thousands of dollars over the life of your loan. That’s why monitoring your credit early and often isn’t just smart—it’s essential.
Why credit monitoring is critical for buyers
Loan approval: Many lenders require a minimum score of 620 for conventional mortgages. FHA loans allow scores as low as 580, and at Tomo Mortgage, we also work with buyers starting at 580—helping more people get through the door.
Interest rates: Even a modest credit score jump can unlock a lower rate. For example, on a $350,000 loan:
- With a 580 score at 7.5% → monthly payment ≈ $2,447
- With a 700 score at 6.5% → monthly payment ≈ $2,212
That’s a savings of $235/month or more than $84,000 over 30 years.
And since lenders don’t all price the same, weigh different loan options to make sure you’re not leaving money on the table.
Down payment flexibility: Lower credit scores sometimes require higher down payments. Improving your score could mean qualifying for a 3–5% down loan instead of needing to put 10% or more on the table.
How to monitor effectively
Use free credit monitoring tools
- Credit Karma and Credit Sesame give you daily score updates and fraud alerts.
- Experian adds free FICO score tracking, plus dark-web scans to catch identity theft.
- AnnualCreditReport.com (the official site) lets you pull one report per bureau every week at no cost. This is the best way to catch errors that could be weighing down your score.
Check your bank and credit card apps
Most major banks (Chase, Wells Fargo, Capital One, Discover) now show a free monthly FICO score in their apps. These updates are an easy, passive way to track progress while you’re saving for a down payment.
Get the scores that lenders actually use
Here’s the catch: most consumer apps show VantageScore, but mortgage lenders use older FICO models (FICO 2, 4, or 5). That means the number you see on your phone might be 20–40 points higher than what a lender pulls. Mortgage-focused services (like Gravy) can show you the right score models so you’re not caught off guard.
Set up alerts for big changes
Fraudulent accounts, reporting errors, or new hard inquiries can drop your score fast. Setting up email or text alerts means you’ll know the moment something changes—and can dispute errors before they impact your mortgage application.
Review all three bureaus
Your Experian, Equifax, and TransUnion reports may not match. Pull all three to check for:
- Outdated accounts
- Incorrect late payments
- Fraudulent accounts in your name
About 1 in 5 reports has an error that can lower your score. Disputing mistakes is free and can bump your score within weeks.
Pro tips for homebuyers
- Check early. If you’re aiming to buy this summer, start monitoring now. Fixing errors or paying down balances can take 30–60 days to reflect.
- Use monitoring to guide action. For example, lowering your credit card utilization from 70% to under 30% could raise your score 20–40 points in a single billing cycle.