You’re getting ready to buy a house. You know you’ll have a down payment and closing costs to cover. But then they’ll be long-term costs to deal with. So it’s understandable if you’re thinking raising your credit limit could help you get through this financially taxing chapter of your life.
But is it really a good idea to raise your credit limit before buying a house? Will it help you in the future, or will it expose you to more risk?
One move you should make is to connect with a real estate agent. No matter what your credit score or budget is, they’ll find you a house you can afford to buy and maintain.
Before you raise your limits, consider the following factors and make sure it’s the right move for you.
Increases Are Usually Beneficial
For the most part, you can’t hurt yourself by increasing your credit limit. The only way raising your credit limit could backfire is if you go over your limit or you don’t have the resources available to handle the higher limit in the first place.
As long as you’re being fiscally responsible and use your increase wisely, having a higher limit can actually help you because mortgage companies assume you’re more financially responsible.
When You Should Seek Out Other Options
While increasing your credit limit is usually beneficial, if you can’t afford to take on the increased limit, it’s best to seek out other options. Even if you’re approved for a higher limit, if you end up defaulting or missing payments, you’ll easily find yourself on a road to poor credit.
Also, if you’re struggling with low income and you want to apply for a federal or state assistance program, it might not be a great idea to increase your credit limit. Doing so might make it seem like you have more financial resources than you do and could, in some cases, hamper your ability to qualify for those grants and programs.
Finally, if your specific situation doesn’t require you to increase your credit limit, then you shouldn’t do it. Working closely with an experienced, local real estate agent can help you determine whether or not you truly need to increase your limit.
If it can benefit you, great. But if you can obtain a mortgage and get through the process without raising it, you might be better off not taking on additional fiscal responsibilities for no reason.
How to Increase Your Credit Limit the Right Way
Increasing your credit limit should only be done after careful consideration. There are many ways to raise your credit limit, and you usually have options regarding how much you want to increase it.
Be sure to go through this process the right way by carefully considering your options and how they’ll help you reach your goals. Work with a mortgage representative to strategically create a plan that will limit your exposure while increasing your chances of success.
Work With an Experienced Real Estate Agent
Buying a home can be stressful and overwhelming, especially given all the financial considerations you have to make. But it doesn’t have to be that way. With an expert guide to help you through the process, you’ll be well on your way to a smooth, successful experience.
Working with a qualified, experienced buyer’s agent is your best option for navigating the home buying process with ease. If you’re thinking about buying a home but you’re not sure how to get started, an experienced, local real estate agent can help you determine when to buy, what to look for, and how to obtain a mortgage.
They’ll guide you through the entire process, from house hunting and applying for a mortgage to negotiations and closing, ensuring the best possible outcome for you while minimizing stress along the way.
Clever Partner Agents have agreed to offer Clever buyers a Home Buyer Rebate of $1,000 in states that allow them (or up to 1% back on homes over $500,000). This rebate can be put toward closing costs, your down payment, mortgage premiums, and more.
All Clever Partner Agents are verified top performers in their local market, so get in touch today and we’ll introduce you to a Partner Agent in your area for a no-obligation consultation.