@VikingsLoyalFan wrote:Hi guys this is my first post! I have been following this forum for about 10 months and it has greatly improved my credit. My fico went from a 518 to 639 in 10 months. My husband and I recently went to speak to a loan officer about a rural home loan. His credit is 551 (fico score). He makes 2 1/2 times the amount I do; however, no loan is possible with him on there. So needless to say I had to do it on my measly 12 dollar an hour job (I am also a full time student). With that said, he came back with a loan offer that blew my mind. I got approved for 100k house (which here is a lot of house in rural GA), low mortgage payments and no money down, with an APR of 3.7% however, needing one more point.
Now here is my dilemma, we mainly went to speak with him to see where to start, how to better our credit, and ask all the questions with the intention of buying a house in March (if there was a possibility). He urged me to open another line of credit. I have my school loans since I started almost 11 months ago, perfect pay on time, and a first premier card for going on 8 months perfect on time paying. So I followed his advice and applied for Capital one, speaking to the lady for over 45 mins before applying.
I gave her everything on my credit so she knew which would be the best to apply for. I only had one hard inquiry on my credit (from the loan officer above). After her telling me to go safe and apply for the rebuilding credit card, I was denied. I have no idea why yet as I have not received the letter. Now I feel like I am stuck between a rock and a hard place. I was one point under 640 before the loan to get the best rate possible, and now I have 2 hard inquiries on my credit.
What advice would anyone offer here, do I try for another card or something risking another HI pull? I only have 2 revolving credit lines on my CR, my school and this CC. I just do not want to ask for a limit increase with them charging 25% on the 100. I would greatly appreciate any advice
Thanks in advance!! -K
I would def recon this thru the EO. Send a email to the ceo of Cap One tons of thread on the this board will walk you through it and tell them exactly what you told us here and be sure to mention that you spoke to a CSR for 45 minutes about your situation. While its not 100% guaranteed that they will approve you it wont affect your credit to try and there is a much greater success rate when the Executive Office gets involved then with any other department within Capital Ones mystical magical mushroom world of under-writing. The only 100% guarantee you have right now is that if you dont follow up you have wasted a hard pull on your credit.
If your not in a rush it will save you 10000's of dollars on a mortage to wait till you get over 680-720 fico and that should easily be do able within 12 months if you are currently at 639.00 while a walmart card would help some fico scores store cards lower then credit cards. You may want to sit down with your husband and discuss what time frame your looking at and if it would be better long term to wait another year before purchasing a home also during that time he can hopefully begin to repair his credit most likely thru secured cards and possibly as a AU on some of your accounts. You should also get rid of that first premier card the second you close on your mortage and after you have obtained one or two more cards. IMO a secured card is much better then a predatory card like first premier. As a full time student you may be eligible for some student cards from some prime companies.
I think the only thing worth risking is a secured card, then wait 6 months before going for that mortgage.
You should also get your husbands scores up into that 640 range as well. Go to the rebuilding section of the forum and work hard on his credit.
Figure out a payment you are comfortable with. I would highly recommend getting a 15 year mortgage over a 30 year. You will pay significantly less in interest, and your payment will still remain affordable.
I would also advise paying a little extra for a house in a good area, it will help with resale in the long run. Make sure the home is sound enough to withstand whatever natural disasters that are common in your area. Then be sure to get insurance that specifically covers those perils.
Thanks everybody! I got my capital one letter and it stated not enough credit history. So, I went with the Walmart card. They approved me for 700 dollars. I am in no rush and my loan officer knows that. He has not bugged me once other than told me to get that 3rd credit line. I just do not want to dilly dally around and miss a great thing. Houses are dirt cheap right now, and as far as I can see they are not going up soon.
I was just approved for a Chase Freedom on 1/10. Applied for it on 12/22 but it took awhile to go through the recon process. I applied with two different lenders for a mortgage on 12/31 and 1/5. Both came back with preapprovals but I have to go with the builder's lender for the incentives.
I was told to NOT use the card until after closing. The Chase Freedom is my third credit line. My app is in underwriting. The first broker I did a preapproval check with back in July said, accounts opened 120 days out don't count and don't require a letter of explanation. To add to it all, my car broke down in Nov and I had to get a new vehicle and I leased it.
My mid fico is 703 and holding steady so the new accounts won't bump me under the threshold. So typically if you apply for a credit card close to a mortgage, they don't want you to use it until after closing as they run your credit one more time before closing and the usage on the card can bump your score down and if you are on the edge, it can disqualify you completely. And they also don't want you to buy large purchases on your current cards. Everyday expenses are okay but be sure to PIF before the statement cuts.
So if you are going to close in March, ask if it is okay for you to use your Walmart card before closing. Getting new credit close to a mortgage depends on one's creditworthiness and the lender. It is recommended that you don't get new credit close to a mortgage but if your score is in the 700's and you manage the new credit as your loan officer tells you to, you should be okay to close. We plan to close by the end of this month. Best of luck to you and congrats on your new card!
I was told to NOT use the card until after closing. The Chase Freedom is my third credit line. My app is in underwriting. The first broker I did a preapproval check with back in July said, accounts opened 120 days out don't count and don't require a letter of explanation. To add to it all, my car broke down in Nov and I had to get a new vehicle and I leased it.
My mid fico is 703 and holding steady so the new accounts won't bump me under the threshold. So typically if you apply for a credit card close to a mortgage, they don't want you to use it until after closing as they run your credit one more time before closing and the usage on the card can bump your score down and if you are on the edge, it can disqualify you completely. And they also don't want you to buy large purchases on your current cards. Everyday expenses are okay but be sure to PIF before the statement cuts.
So if you are going to close in March, ask if it is okay for you to use your Walmart card before closing. Getting new credit close to a mortgage depends on one's creditworthiness and the lender. It is recommended that you don't get new credit close to a mortgage but if your score is in the 700's and you manage the new credit as your loan officer tells you to, you should be okay to close. We plan to close by the end of this month. Best of luck to you and congrats on your new card!
Cards: Orchard Bank ($1100) | Cap1 Cash Rewards ($2500) | Chase Freedom ($1000) | Best Buy ($2500) | Discover It ($1000) | Barclay Rewards ($2500) | Current scores: EX FAKO: 684, CK TU: 649, FICO EQ: 680, FICO TU: 698, FICO EX: 658 Happy Homeowner Since 2/6/13! Congrats on all your success as well! It is confusing for sure. However, I am just following his advice, but asking questions along the way. I do not need to buy in March, I can buy whenever. I just want to make sure I am doing everything correctly. I may wait another month or so if my credit will pull up some. I am going day by day. The Wal-Mart card pulled my credit up 16 points. Another school loan went on my credit that upped it another 20 points.
I am extremely happy with how things are rolling. Again congratulations on your soon to be home 
And thanks for the advice!!
Thanks Viking! And I wish you the best of luck on your mortgage this spring! My loan was conditionally approved 1/17 and I received my loan commitment letter as well. My underwriter said she is working the weekend so I will send the docs she needs to her email this weekend and hopefully by Friday I will be approved! Then it goes to the underwriter that will be servicing my loan and my loan officer said that will be an easy approval. And then hopefully I will get cleared to close by 1/31! I can't wait to get out of this rental property!