Are you in the market to purchase a house? If so, you are not alone. Every year in the United States millions of homes are bought and sold. And many homes are purchased by first-time home buyers. In fact, 32% of those who are interested in buying a new house are actually first time home buyers. If you are one of these first time home buyers, you’ll need to have a good credit rating. Here are five tips to get your credit score in good shape before you buy your first home.

1. Always Pay on Time

This is rule number one. Lateness will count against you, and it is a poor reflection on the way you run your life. Lenders will not favor people who do not pay on time. So if this has been an issue for you, turn over a new leaf. Make sure to take care of it as soon as possible.

2. Watch for Inaccuracies in Your Score 

Check your score frequently and be on the lookout for report errors or inaccuracies. This is especially relevant in today’s world, where identity theft is a huge problem that is all too common. If you are involved in any disputes, remember that it usually takes about a month for a report to be completed, so you may want to factor this into your timeline for buying a house.

3. Be Strategic 

If you are thinking about taking on new debt, or closing out any of your existing accounts, make sure that you have thought it through and that you have a strategy. Try to keep your debt load low, and if you do take on any new debt, be sure to make your payments promptly. Reconsider closing any old accounts, since the balance available on them can help raise your credit utilization ratio.

4. Reevaluate Your Credit Mix

Your credit mix is a reflection in your credit history of the types of loans you have taken out in the past. This includes mortgages, as well as other kinds of loans, such as student loans, and automobile loans. Of course, credit cards are also part of your credit mix. Lenders looking at the credit scores of first time home buyers are interested in seeing a well-balanced mix. Too many loans in one area are not as attractive as a well-balanced credit mix.

5. Optimize Your Credit Utilization Ratio

Your credit utilization ratio is simply the comparison between the amount of credit that you are allowed and the amount of credit that you are using. When the balance that you owe on your credit cards is measured in relation to your cards credit limits, this is called the credit utilization ratio. Ideally, an individual wants this ratio to be below 30%. However, for first-time home buyers, lenders prefer the ratio to be 15% or below. In order to do this, you have to get your balance down. You can do this by paying more every month on your balance. You can also increase the number of cards that you have, which will change your ratio because it will increase the credit that you are allowed.

For first time home buyers, the dream of purchasing a home is a journey that can be realized. Understanding your real estate agent, your mortgage company, up to date mortgage rates and the importance of a good credit record are all great places to start. With hard work, and a little luck, too, you’ll spiff up your credit rating and then before long you’ll be moving into your very own home!