Credit scores, along with your overall income and debt, are a big factor in determining if you'll qualify for a loan and what loan terms you'll be able to qualify for.
 
3 Months prior to looking for home, should give you time to get basics done with your credit. For more difficult issues, it could take many more months if not years to straighten out. Any additions/reduction of balances on credit cards takes a good three months to even out with all institutions.

1.     Credit Check - Check for and correct errors in your credit report. Mistakes happen, and you could be paying for someone else's poor financial management.  Experian is a good one to do a preliminary check because it's free, once every 6 months.

2.     Bank Accounts - Depending on the type of loan you apply for, can determine if your bank statement is good or not so good. If needed, bank statements show your deposits and width drawls which are looked at to make sense to a loan. If you say you're a teacher making $150K per year but your statement says you are around $40K per year, it's highly doubtful you will get the loan.

3.     Pay Down Cards - You do not have to pay off the entire credit card lines, in fact, having no balances can sometimes lower your score. If you have one card that is over 48% of the limit, you need to either pay this down so that it is 47% or under the limit or spread the amount over one or two other cards you have. Having some balance on two to three cards is actually better than having no balance at all.  However, you must do this, 3 months prior to obtaining a loan application request and running your report.  Pay down credit card bills. If possible, pay off the entire balance every month. However, transferring credit card debt from one card to another could lower your score.

4.     Credit Difficulties - Wait 12 months after credit difficulties to apply for a mortgage. You're penalized less for problems after a year and gives you more time to establish other credit in the meantime. When trying to establish credit after having issues, try to open new credit with high-ranking institutions even if their rate is 30% or more. Nobody says you have to use them! It's to establish credit, not use. Get it?

5.     Large Purchases - Don't order/buy items for your new home until after the loan is approved and done with. The amounts will add to your debt and most lenders check your credit once again right before final approval of the loan. This is standard practice to make sure you are not a risk with impulsive spending habits.  Don't purchase big-ticket items for your new home on credit cards until after the loan is approved. Don't charge your credit cards to the maximum limit.  The amounts will add to your debt.

6.     New Credit - Don't open new credit card accounts before applying for a mortgage. Having too much available credit can sometime lower your score. Having your credit checked to obtain the new credit can also lower your score. Wait until after you buy or establish 3 months prior.

7.    Credit Applications - Shop for mortgage rates all at once. Too many credit applications can lower your score, but multiple inquiries from the same type of lender are counted as one inquiry if submitted over a short period of time like 14 days or so.

8.      Finance Companies - Avoid finance companies. Even if you pay the loan on time, the interest is high and it will probably be considered a sign of poor credit management. Certain finance companies are look at with high risk. Many with bad credit fall into the arms of waiting finance companies to charge a high rate, what got you into bad credit in the first place. Sort of a double whammy!