topic Re: Any advice appreciated in Understanding FICO® Scoring

Any advice appreciated

Tparker — Fri, 27 Apr 2012 16:00:37 GMT

We are currently in the process of trying to buy a home. The following is our current status.

I have paid off all medical and other collection accounts as of 2/1/12

One new credit card opened at that time, on time payments and below limits.

Added as authorized user on two cards with over five years of positive, never late, never over limit payments.

There is a tax lien showing as filed 8/2003 and released on 9/2007.

One car loan that is now paid off totally but did have several over 90 day late payments that falls within the 7 year period on report ... belonged to ex-spouse and was signed over in divorce when balance was paid off.

Since adding the lines of credit and paying off the collections scores have DROPPED! Is this normal?

I used scoresense.com and it is showing these scores: Transunion 554, Equifax 560, Experian 553.

What am I doing wrong? Should scores not be going up at this point? We desperately need to get into the 640-680 bracket to get Fannie Mae financing on a home we found ASAP.

Any advice is appreciated. Also, should we take a chance on a credit repair company to get faster results? I have read a lot of good reviews for Sky Blue and would love some feedback.

Thanks again,

Tamara

Re: Any advice appreciated

pizzadude — Fri, 27 Apr 2012 16:43:33 GMT

Tparker wrote:
We are currently in the process of trying to buy a home. The following is our current status.

I have paid off all medical and other collection accounts as of 2/1/12
One new credit card opened at that time, on time payments and below limits.
Added as authorized user on two cards with over five years of positive, never late, never over limit payments.
There is a tax lien showing as filed 8/2003 and released on 9/2007.
One car loan that is now paid off totally but did have several over 90 day late payments that falls within the 7 year period on report ... belonged to ex-spouse and was signed over in divorce when balance was paid off.

Since adding the lines of credit and paying off the collections scores have DROPPED! Is this normal?

I used scoresense.com and it is showing these scores: Transunion 554, Equifax 560, Experian 553.

What am I doing wrong? Should scores not be going up at this point? We desperately need to get into the 640-680 bracket to get Fannie Mae financing on a home we found ASAP.

Any advice is appreciated. Also, should we take a chance on a credit repair company to get faster results? I have read a lot of good reviews for Sky Blue and would love some feedback.

Thanks again,
Tamara

Welcome to the forums !

If you are looking to purchase a house in the near future the first thing I would recommend is to pull your FICO credit scores to see where you stand. The scores you have listed are FAKO scores and are not used by mortgage lenders. The EQ FICO score sold at MyFICO would be a good place to start.

How recent are the late payments ? Have you tried sending GW letters to the creditor requesting that they remove the lates ?

What is your current revolving utilization as shown on your credit reports ? Ideally you would want only one CC reporting a small balance ( less than 9% ), with the others reporting a zero balance.

Re: Any advice appreciated

Tparker — Fri, 27 Apr 2012 18:02:45 GMT

Thank you for the reply! You're going to have to go with baby steps for me here as I am very new to all of this!

First the late payments are all from over 1 yr ago, but there was several from what I can see. It was a situation where the car was in my name, the ex-spouse was making the payment and I didn't even realize they were being paid late until now. Soooo, here I am stuck with it. The last late payment that is showing is from March of '11 and then the vehicle was paid off in full.

One credit card has a small amount, about 30% of the credit limit which I can pay down to below the 9% easily. The other two with the longest standing history have a zero balance.

What is the GW letter? I am not familiar with that. Also, do you think that the tax lien still showing is affecting the scores eventhough it is paid and released almost five years ago?

Thank you so much, I am going to pull FICO's now and see what they show!

Re: Any advice appreciated

pizzadude — Fri, 27 Apr 2012 18:21:35 GMT

No problem ~ welcome aboard :)

There is a lot to read here, so just take your time to absorb and don't feel bad about asking questions.

Sounds like you're in pretty good shape on your CCs ~ once you pay the card with 30% util lower it should help your FICO score.

Unfortunately with your car loan you're in a bad situation, but thankfully the loan is paid now. I would try writing them a Goodwill ( GW ) letter, asking them to help you and remove the late payments. Tell them you were in a divorce situation and hopefully they'll be sympathetic. There are some good resources here in the Rebuilding your Credit forum ----> take a look at the Goodwill Primer link http://ficoforums.myfico.com/t5/General-Credit-Topics/Frequently-Requested-Threads/m-p/10675

The tax lien is still hurting your FICO score ~ you might be able to get it removed though. Is it federal tax or state tax related ?

Re: Any advice appreciated

Tparker — Fri, 27 Apr 2012 18:25:08 GMT

It is a state tax lien. Any advice for getting this cleared would be great. I am sure that it is killing the score.

I also just pulled the myFico for equifax and it is a 621. Do you know where I can get the best report of my transunion and experian scores? What exactly does the mortgage companies (attempting both Fannie Mae and USDA) pull to get scores?

Again, thanks for the advice - going to research those GW letters now!!

Re: Any advice appreciated

pizzadude — Fri, 27 Apr 2012 20:48:02 GMT

Tparker wrote:
It is a state tax lien. Any advice for getting this cleared would be great. I am sure that it is killing the score.

I also just pulled the myFico for equifax and it is a 621. Do you know where I can get the best report of my transunion and experian scores? What exactly does the mortgage companies (attempting both Fannie Mae and USDA) pull to get scores?

Again, thanks for the advice - going to research those GW letters now!!

Ok, I was hoping that it was an IRS lien, I know that sometimes they can be removed. State liens I'm really not sure, there may not be a way to get them taken off. :(

The Transunion score sold here is TU98, which is an older version and the TU04 FICO version that is commonly used by mortgage lenders, so it may not be a good comparison for you. Unfortunately neither TU nor EX will sell you a FICO score directly from their websites.

You can get your FICO scores from creditors, some provide a monthly score as a benefit, or if you are approved for credit they'll give it. Many creditors pull EX or TU. Is the information on your reports fairly consistant across all of your reports, TU, EX and EQ ?

Re: Any advice appreciated

Tparker — Sat, 28 Apr 2012 00:53:50 GMT

Just my luck ... do you know if the 7 years that it will stay on the report stars from when it was filed or when it was released? Information on the three reports that I have been able to pull from various sites seems to be consistant across the board. There are some items reporting on one and not others and some of the medical collections that I paid off still have not updated in Transunion so I disputed those through the site. I've also noticed that some of the accounts that are closed already show a status of late. I also disputed those to have the correct status applied with the date that they were paid.

GW letter sent today, fingers crossed. I think that is a huge issue for our scores. How long does it usually take to see a response?

Re: Any advice appreciated

Tparker — Sat, 28 Apr 2012 00:56:51 GMT

So eventhough my TU98 and TU04 show a certain score, that may not be what the mortgage companies see? Why must this be so complicated!?!?

Re: Any advice appreciated

pizzadude — Sat, 28 Apr 2012 01:16:22 GMT

Tax liens will show for 7 years from the date paid. For your medical collections there is a HIPPA process that some people have used to successfully get medical collections removed from their credit reports ~ you might try looking into that, google "HIPPA process to remove collections".

TU04 is pulled more often by mortgage lenders, but we can't buy this version unfortunately. :(

GW letters vary by creditors. Some don't respond to them at all, some will send you a letter back within a few weeks. If they say no, don't give up, you have to keep trying....

Re: Any advice appreciated

RobertEG — Mon, 30 Apr 2012 00:31:27 GMT

One of the problems with tax liens, as with other public records, is that it is often next to impossible to take the normal route of asking for GW deletion.

GWs go to the party who reported the negative information, asking them to delete their own reporting.

Who reported the information to your credit file? The state? A private researcher of public records? You usually havent the slightest clue.

One path you might pursue is to send an information request to the CRA under FCRA 609(a), and get the name of the reporting party.

Consumers are entitled under that section to any information of record in their credit file.... for the required fee, which is currently $11.00.

It is not a disputable issue under the FCRA, as the issue is not one of accuracy of their reporting, so you wont be able to compel the CRA to use their reinvestigation rights to determine the accuracy of the reporting.

Re: Any advice appreciated

Tparker — Mon, 30 Apr 2012 00:57:00 GMT

Thank you for the info. I will check into that tomorrow.

Re: Any advice appreciated

Familywantsahouse — Mon, 30 Apr 2012 10:07:22 GMT

I just read in the other forum that you *might* be able to take the route of getting a letter from the state to send to the CRA if it's a 3rd party reporting.

I have a tax lien on my report that was filed in error, and "discharged". Well, the lovely 175 year old woman at the records office informs me that someone comes and reads the book, and it's in the book so it's being reported.

I thought she was nuts, but turns out there are actually 3rd party companies who provide this information to the CRA's.

I plan on calling the state IRS today to try to get a copy of a letter that the original lien was filed in error, and sending it to the CRA's for deletion.

Good luck!

Re: Any advice appreciated

Tparker — Mon, 30 Apr 2012 15:17:44 GMT

Sounds like you are having the same issue as me. I spent hours this morning calling a hundred different people, all who told me that there was no lien filed. Finally contacted the clerk of courts, gave them the book and page number that was reported on the credit report and she states that it is the Ga Dept of Revenue. I contacted them and they stated that I have never owed the state of GA taxes (which I already knew!) So, the rep there is emailing me a letter stating that I have never owed taxes to the state and I have requested a certified copy of the lien from the clerk of court. When I spoke with the clerk of court representative she told me that the lien was discharged and paid in 2007. Problem with that is that I never paid anything as I never owed anything!

So where do I go from here? Do I submit both forms to the bureus and let them take it from there, or am I chasing a dead end road on this one?

Re: Any advice appreciated

PrescottJ23 — Tue, 01 May 2012 05:09:27 GMT

Hello I am new to this forum, and I am also in the process of repairing my credit.

I don't have much advice to offer since I am in the rebuilding stage myself but for what its worth, here are a few things of note.

After going through a divorce, I finally looked at my Credit Report for the fist time in 8 years for the pupose of re establishing my credit.

So I opened a new account at Chase and was hoping to get an auto loan and apply for a credit card.... DENIED!!!

I explained to them my credit situation and the idiots encouraged me to apply anyway.

So after that embarressment I finally looked at my credit report ..... 2/2012: EQ - 589 EX - 601 TU - 612 .

I was told I was denied credit because I had 3 past bad accounts and a lack of revolving credit.

So after that embarressment, I took matters into my own hands and educate myself on the process.

1. I looked at my credit report and disputed a couple of old accounts that should have been off

2. Next I opened 3 Capital One secured credit card accounts to establish revolving credit accounts

3. I made sure to keep my debt to credit ratio under 35%. (Keeping unused availble credit @ 75% is a key goal that raises your score)

These are my current scores as of 4/24/2012: EQ - 600 EX - 713 TU - 702.

(My EX and TU scores increased over 100 points in 2 months my EX score is still lagging)

my limited advice to you would be to:

1. " Dispute" any charges you feel are unjust and any charge you dispute, will come off your account automaticlly if there is no response from the creditor .

2. Open 3 secured credit accounts from Captial One.

3. Keep your balance low and your avaible credit high as this will increase your score. (Target 75% avaible credit).

The way I see it, this is the "Game of Life", and our goal should be to learn the rules of the game and master the game, while having fun doing it.

I am only 2 months into the restoration process, so its a long journey to 800 FICO and I am only in the 1st inning of a 9 inning game.

As a newly enlightened FICO Fighter!.. I hope I have offered you some advice that you can use.

Good Luck!

Re: Any advice appreciated

Tparker — Tue, 01 May 2012 15:47:32 GMT

It sounds like we are in the same boat! I am working hard at getting those numbers restored. It does seem to be a long and diffficult and very confusing road ahead but at least we are making that step!