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Valued Member
Posts: 31
Registered: ‎03-12-2013
0

My Auto Lease May Affect My Home Purchase

Dear Community, Please beware of erroneous information that I received from ALLY FINANCIAL!  I am begining the process of first-time home ownership and was banking on my good credit scores to stay intact.  However, to lower my DTI, I called ALLY and they informed me that I can pay off my lease early with no penalty--and my account staying opened until the vehicle is turned in---(in 4 mons. later).

 

Once I Paid off my Lease positively affecting my DTI, Immediately, my credit score dropped 42ptsSmiley Sad.  Wow!  I was livid with ALLY! They tried to explain that the account is still open....so, I called to verify with all 3 Credit Bureaus who confirmed that the account is closed! Smiley Sad   I hope this helps, I did not know how or where to post this.....Can someone provide some knowledge on my situation????

Credit Scores: Beginning, March 2011: EXSmiley Sad590),TUSmiley Sad595), EQSmiley Sad597)
Current Scores: EX: (???). TU: (???). EQ: (???)

Vantage3 Scores: EX: (742), TU: (752), EQ: (752)

Goal Scores: EX: (850) TU: (850). EQ: (850)

Credit: AllyLease-(19,500), Amex EVD-(12,000), AmexBlue-(5,000), BOA Cash Re-(16,000), BOA BB-(9,000), USAA Visa-(13,000), Walmart Visa-(10,000), JCP-(10,000), Discov it-(7,500), CitiPrefer-(7,400), CitiSimp-(4,200),NFL-(5,000), CapVisa-(3,500), CapSilver-(5,000), ChaseSla-(1,000), ChaseFre-(1,000), DCFCU-(1,000), WFSecured-(800).
Moderator
Posts: 10,586
Registered: ‎03-06-2010
0

Re: My Auto Lease May Affect My Home Purchase

Yes, this is common to lose many points when paying off your only open installment loan.

 

You can fix this with a shared secured loan for $500 (so it doesn't mess up your DTI).  Here is the thread that explains in the first couple of posts:

http://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Adding-an-installment-loan-the-Share-Secu...

New Contributor
Posts: 59
Registered: ‎04-19-2015
0

Re: My Auto Lease May Affect My Home Purchase

Dear OP, the information that was given to you by Ally Financial was not Erroneous in any way.  When you asked them if your account would stay open and they told you yes it was correct.  You still have an open account with Ally because they still own the car that you leased from them.  Your credit account no longer has a payoff and the credit reporting agencies report it as thus.  If you were to call Ally and ask them to look up your account they would be able to and it would still be an open account interanlly with them.  Maybe it was a misunderstanding on your part that it would remain open on the bureaus?

Valued Member
Posts: 31
Registered: ‎03-12-2013

Re: My Auto Lease May Affect My Home Purchase

Dear NesainRep:

 

Unlike most I have a good understanding of the English language and I clearly articulated my goals to Ally and explained what my intentions were!  They themselves confessed later that they sent info. To credit companies that the account was now closed!  Even though, they have it listed as opened! 

 

My post requested help and elaboration not an opposing defense for Ally!  Remember, I took the 42pt. Drop not Ally!  Do you think I should be penalized for good/responsible behavior??  Please Respond???!!!!

Credit Scores: Beginning, March 2011: EXSmiley Sad590),TUSmiley Sad595), EQSmiley Sad597)
Current Scores: EX: (???). TU: (???). EQ: (???)

Vantage3 Scores: EX: (742), TU: (752), EQ: (752)

Goal Scores: EX: (850) TU: (850). EQ: (850)

Credit: AllyLease-(19,500), Amex EVD-(12,000), AmexBlue-(5,000), BOA Cash Re-(16,000), BOA BB-(9,000), USAA Visa-(13,000), Walmart Visa-(10,000), JCP-(10,000), Discov it-(7,500), CitiPrefer-(7,400), CitiSimp-(4,200),NFL-(5,000), CapVisa-(3,500), CapSilver-(5,000), ChaseSla-(1,000), ChaseFre-(1,000), DCFCU-(1,000), WFSecured-(800).
Valued Member
Posts: 31
Registered: ‎03-12-2013
0

Re: My Auto Lease May Affect My Home Purchase

Hey Starting over, 

Thx. For your help/positive input!!! Do you think it's too soon to have credit ran to get the $500 loan when I'm requesting a home loan?

Credit Scores: Beginning, March 2011: EXSmiley Sad590),TUSmiley Sad595), EQSmiley Sad597)
Current Scores: EX: (???). TU: (???). EQ: (???)

Vantage3 Scores: EX: (742), TU: (752), EQ: (752)

Goal Scores: EX: (850) TU: (850). EQ: (850)

Credit: AllyLease-(19,500), Amex EVD-(12,000), AmexBlue-(5,000), BOA Cash Re-(16,000), BOA BB-(9,000), USAA Visa-(13,000), Walmart Visa-(10,000), JCP-(10,000), Discov it-(7,500), CitiPrefer-(7,400), CitiSimp-(4,200),NFL-(5,000), CapVisa-(3,500), CapSilver-(5,000), ChaseSla-(1,000), ChaseFre-(1,000), DCFCU-(1,000), WFSecured-(800).
Community Leader
Super Contributor
Posts: 14,621
Registered: ‎11-11-2014

Re: My Auto Lease May Affect My Home Purchase


Mike2 wrote:

Hey Starting over, 

Thx. For your help/positive input!!! Do you think it's too soon to have credit ran to get the $500 loan when I'm requesting a home loan?


If you are in the process of getting a home loan then it is not a good idea to be getting a new account / having your credit run.

Moderator
Posts: 10,586
Registered: ‎03-06-2010
0

Re: My Auto Lease May Affect My Home Purchase


Yes-Its-Me wrote:

Mike2 wrote:

Hey Starting over, 

Thx. For your help/positive input!!! Do you think it's too soon to have credit ran to get the $500 loan when I'm requesting a home loan?


If you are in the process of getting a home loan then it is not a good idea to be getting a new account / having your credit run.


True^^.  I didn't realize that you were already under contract and in the middle of financing your home loan. 

New Contributor
Posts: 65
Registered: ‎07-08-2016

Re: My Auto Lease May Affect My Home Purchase

Crappy situation, but thanks for sharing it, hope it all works out for you in the end!

Valued Contributor
Posts: 1,571
Registered: ‎12-16-2014
0

Re: My Auto Lease May Affect My Home Purchase

I am sure the agent was well intended when they offered this solution however your mortgage loan officer should have warned you that doing anything of this type is a risk. I suspect even had they kept this opened it might have been a concern as they reviewed your credit and finances for the mortgage because in 4 months you would clearly have the debt back when you leased another car so it was a short term DTI strategy.  Sorry this happened to you I am sure its very stressful. 

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Valued Member
Posts: 31
Registered: ‎03-12-2013
0

Re: My Auto Lease May Affect My Home Purchase

Thx. For insight....We were going to get another lease after closing.  However, our timeframe might interfere/workout transportation... Home ownership is our #1 Priority!

Credit Scores: Beginning, March 2011: EXSmiley Sad590),TUSmiley Sad595), EQSmiley Sad597)
Current Scores: EX: (???). TU: (???). EQ: (???)

Vantage3 Scores: EX: (742), TU: (752), EQ: (752)

Goal Scores: EX: (850) TU: (850). EQ: (850)

Credit: AllyLease-(19,500), Amex EVD-(12,000), AmexBlue-(5,000), BOA Cash Re-(16,000), BOA BB-(9,000), USAA Visa-(13,000), Walmart Visa-(10,000), JCP-(10,000), Discov it-(7,500), CitiPrefer-(7,400), CitiSimp-(4,200),NFL-(5,000), CapVisa-(3,500), CapSilver-(5,000), ChaseSla-(1,000), ChaseFre-(1,000), DCFCU-(1,000), WFSecured-(800).

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