The federal government has been investigating some new avenues in an attempt to revive the currently depressed housing market. Take, for example, this article about the proposed tax credit increase – from $8,000 to $15,000 – for first-time homebuyers:

http://bloomberg.com/apps/news?pid=20601087&sid=alfbV3LXPE_E

One reader responded with this inquiry:

… Won’t even talking about doubling the credit next year have the effect of hurting home sales this year? If I thought the 8k would expire, I might feel compelled to buy sooner rather than later; but if I think there’s a good chance I can get 15k next year AND benefit from the plunging house prices, why would I buy now?

That’s a pretty legitimate question, if the tax credit is going to double next year, why would you buy now?

At Veracity, we’re not real estate experts, but we are trusted partners of both the National and Colorado Associations of Mortgage Brokers. So we do understand the effect your credit score can have on your home mortgage. Since credit is so unique per individual, and mortgage rates depend so much on the lender, location and other variables, it’s nearly impossible to make any exact calculation as to how much money you can save with a good credit score.

However, it is generally agreed that some of the best rates go to consumers with credit scores over 700. So, with that in mind, it’s probably safe to assume that a 600 credit score could cost you a couple of percentage points when it comes to your mortgage rate. And a couple of points difference in mortgage rate percentage can equal a lot of dough.

The point is, Veracity encourages you to not only take advantage of housing tax credits when it comes to buying a new home, but take advantage of credit repair, too. Veracity’s customers often see results (i.e. increased credit scores) within six to 12 months of membership. So, while a tax credit increase of $7,000 is tempting, the real reason you may want to wait six months to a year to buy is so that you have time to achieve a more optimal credit score. After all, a better credit score, leading to even a 1 % better mortgage rate, could save you tens of thousands of dollars over the next 30 years, making that mere $7,000 savings seem rather insignificant.

So our advice at Veracity is not to rush into buying a home, because repaired credit can be tantamount to a better mortgage rate, and that means major money saved in the long haul. Tax credits are just the tip of the potential iceberg of savings!