The first thing you should do before you start house hunting is check your credit report. You can check it for free at www.annualcreditreport.com. You can get one free credit report from each of the main credit reporting agencies, Experian, Equifax, and TransUnion, once every twelve months. Since the credit reports don't show your credit score, you can pay a small fee to purchase your score from the credit agencies or from www.MyFICO.com.

Get your free credit reports for Experian, Equifax, and TransUnion through the following methods:

Website: www.annualcreditreport.com Phone: 877-322-8228 Mail: Fill out the Annual Credit Request Form and mail it to Annual Credit Report Request Service, P.O. Box 105281, Atlanta, Georgia, 30348-5281

To get the best loan rates, experts recommend a score above 680 to mid-700s or higher. The higher your score the better your interest rate, which ultimately means a lower monthly house payment.

Lucy Duni, director of Consumer Education for TransUnion's TrueCredit.com says improving your finances before you start to shop can help you save thousands on your mortgage. Reducing your loan rate by half a point will save you $22,000 over the life of a $200,000 loan. The problem most people have is not knowing where to begin, so we asked an expert for the most effective tactics to improve your credit.

Craig Watts, public affairs manager for Fair Isaac Corporation, the creators of the FICO credit scoring system, says to manage your credit score well, you should follow three guidelines consistently: 1) always pay every bill on time; 2) keep credit card balances low; and 3) take on new credit only when you really need it.