GOOD CREDIT IS JUST AS IMPORTANT AFTER YOUR HOME PURCHASE

Written by Jaymi Naciri   

Everybody knows how important it is to have great credit when you're buying a house. But keeping your credit good after you've purchased is just as critical. Letting your score take a hit after you close escrow can negatively impact you in a few important ways.

Credit Cards

It's easier than you think to get into trouble with credit cards once you become a homeowner. One late or missed payment is all it takes to get your first ding.

Even if you don't have any credit cards when you buy your home, make your first mortgage payment and watch your mailbox fill up with pre-approval offers. While it might be tempting to get all those cards and charge them up with new furniture and window coverings and TVs and appliances, it might be best to wait. As a new homeowner, you don't yet know what your total monthly nut will be.

Maybe the utilities are way more than you expected. Perhaps your air conditioning goes kaput the first time you turn it on in the spring or your handyman discovers asbestos while scraping the cottage cheese ceilings in your living room. What if rising values in your area means higher taxes for the next year? Delaying some or all of those purchases until you know what you can easily afford can help you stay in good financial shape.

Refinancing

If rates drop after you've moved in or you didn't get the greatest rate to begin with, refinancing might be your answer since it can save you money every month and over the life of your loan. If your credit score has gone up since you purchased, which often happens after a mortgage payment or two, you might be in a good position to refinance. If your credit score has dropped since your lender approval because you took out too much credit or were late on any of your payments, you may not qualify, which would mean sticking with your existing rate.

Another good reason to refinance is lower private mortgage insurance (PMI) rates for those with a Federal Housing Administration (FHA) loan. The lower rates are expected to save homeowners up to $900 per year, according to the U.S. Department of Housing and Urban Development.

Cars, cable, and cell phones, oh my!

The bump in your credit score post-mortgage can help you get a better rate when buying a car, whereas a credit score in decline could mean not qualifying at all. But even smaller purchases and necessary services can be affected by poor credit.

"Cell phone companies run a credit check on you every time you sign up for a new contract," said CNN Money. "The rationale is simple: Wireless companies want to make sure you'll pay your bill. The company "has revealed that 50% of its customers don't qualify for its top promotions."

In disputes, the Credit Reporting Agencies will be required to use trained employees to review all supporting documents by consumers who see an error in their files.

On occasion, we will see a container marked "Handle with Care" cautioning the handlers that the contents inside are fragile. Presumably, the handlers will be diligent and respectful of the contents and will cautiously carry the container. 

Each handler may honor the instruction, drawing upon his or her own personal value system, work ethic, and respect for the trust that the sender has placed in the transportation system.

From time to time, we may need to be "handled with care" when we are experiencing challenges, turmoil, and crises in our lives. At these times, we may be more sensitive or unable to cope with even the slightest challenging situation. It is then that we could attach a label that is marked "handle with care."

The same applies to others -- our children, spouses, significant others, friends and co-workers. The label suggesting that we are vulnerable may not always be displayed outwardly, but may be detectable only by looking closely. Some people may be more vulnerable than others and they may show it.

Other folks feel that it is necessary to hide their vulnerabilities, believing it to be a sign of weakness. Or they may believe that no one cares. However, the absence of a label or hiding the suffering does not mean that we are not in extreme emotional pain. 

There are numerous causes of our emotional pain, and there will be many times in our lives when we experience our frailty.  Our pain can be eased when we know that someone truly cares and they express their concern.  We must also handle our self with care during these times. 

It may be necessary to add a protective layer around ourselves as we are recovering, to ensure that we are not further harmed by a careless, insensitive, or thoughtless "handler" with whom we come in contact. This requires wrapping ourselves with the understanding that even when we experience bumps and bangs there is generally no intent to harm us. 

In addition, if we are cloaked in the recognition that we are stronger than the situations and people that we encounter, we can survive anything. We may not enjoy the journey, but we won't come out of it shattered. 

We can assist ourselves and others by asking for what we need. We can assist others who may be in pain by asking what they need from us. 

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