10-04-2012 02:56 PM
hello! I have been lurking around for a while, you guys have great information. My question is about buying a home. MY BK chapter 7 was discharged October 2011, I am one year out and have the following:
Cap1 with $500 CL (started October 2011)
Cap1 car loan for 10k (started June 2012)
and just recently I applied for and was approved for two more cards
Cap1 rewards $1000 CL (Oct 2012)
Credit1 CL $300
My question is, do I need any more credit? I know I need to keep my total usage under 10%, but is the 1800 plus the car loan enough to show that I can manage it? My goal is to buy a home next October at the end of my two years post discharge....
10-06-2012 02:00 PM
You should be fine. You have demonstrated revolving and installment loans, and a comfortable number of trade lines.
Just keep your utilization below 20% (maximum ...) and PIF each month if possible. Religiously, and I do mean religiously, make your payments on time.
3 to 6 months (6 months is ideal) out from your planned mortgage application date, stop applying for new credit. You want the mortgage lender to see established lines with a healthy payment history and low utilization, along with low to no inquiries for the 6 months preceding the app.
Do that and your chances of being approved will increase. Just don't get discouraged if lenders decline to buy the mortgage. a BK is toxic, and that may slot you into less than prime lenders & rates, but anything can be done with enough work and diligence. Just stick with this and live the lesson that it teaches about managing debt.
10-06-2012 11:37 PM
Thank you! I think since I have those three cards, I am done applying for anything. Im praying for that last 70 points to come over the next year with good payments and low utilization. I appreciate the advice.
IMPORTANT INFORMATION: All FICO® Score products made available on myFICO.com include a FICO® Score 8, along with additional FICO® Score versions based on Experian or Equifax data (additional FICO® Score versions based on TransUnion data are not currently available on myFICO.com). Your lender or insurer may use a different FICO® Score than the versions you receive from myFICO, or another type of credit score altogether. Learn more
FICO, myFICO, Score Watch, The score lenders use, and The Score That Matters are trademarks or registered trademarks of Fair Isaac Corporation. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Many factors affect your FICO Score and the interest rates you may receive. Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating. FTC's website on credit.