Need to increase Fiance's Credit Scores -- suggestions/tips

[bartoe]

Hello!

I'm not new to myFico, but I'm trying to figure out how to help my fiance out.  We are getting married February 2014 and would like to purchase a house in about 2-3 years to be closer to his daughter.  Luckily where his ex-wife moved to isn't an expensive area (unless you want it to be) and we can get a bigger house for cheaper compared to an area where my fiance would like to live in (the schools are a lot better compared to where his ex moved too).  He was in the Navy for 5 years, so he qualifies for a VA Mortgage loan which means we don't need a down payment, pay less closing costs, no PMI etc.

Because of my student loan debt for the last 10 years, my current mortgage (house is up for sale) and my credit card debt, I'm not going to be on the loan, so unfortunately the home purchase will be in his name only.  His average account is about 3 years old, with the oldest card is about 9 years old (this would be the GM MasterCard that he is an authorized user on).

His situation is that he doesn't have a lot of credit out there.  His current TU score is 620 (haven't had a chance to pull it from anywhere else at this time).  This is what he has out there:

Discover:

Limit of $5,600.00

Current Balance: $3245.00

Citi MasterCard:

Limit of $1200.00

Current Balance: $41.48 - pd off at the end of the month

Target:

Limit of $700.00

Current Balance of $226.06 - pd off at the end of the month

Artvan:

Limit of $3000.00

Current Balance: $1200.00 - pd off in april 2014

(this card has 0% until April and October 2014)

Authorized User on the following:

My GM Mastercard:

Limit $6500.00

Balance: $5900.00

My Target Card:

Limit: $500.00

Current Balance: $99.37

Auto's - Lease

Current Balance Remaining on his Lease: $6,888.00 (until august 2015)

Current Payment: $308.26

Student Loans:

Sallie Mae - Private (he was unable to get the GI Bill for one semester)

Balance: $6160

Payment: $80.00/mthly

Federal Student Loans

Balance: $6250

Currently in deferment and will not be repaid back until 2016

I am hoping that we can get some really good tips so that by the time it comes for us to purchase a house I would like for us to be able to get the lowest rate possible at the time so this would mean needing to increase his scores.  Obviously we are not in a huge hurry and we have some time, but any suggestions or feedbacks would be amazingly helpful so we can get started now on it.

[llecs]

The fastest way to increase FICO scores is to focus on revolving credit. I'd pay it all off, including the AU TLs if possible. It doesn't have to be done all at once, but he'd certainly would want to get a handle on it within several months of buying the home. On the AUs, he could remove himself and that would fix that issue. The only thing to consider is the length of history on those two accounts. Once removed, then that can help/hurt his FICO in some situations (the GM would likely hurt if removed as an AU). I'd pay any loans as scheduled.

And it should go without saying, always opt out of the 3 CRAs months prior to the mortgage and be sure to use the cards at least once every 4-6 months to keep them from closing it due to non-use.

[drkaje]

That nearly maxed-out GE card is probably doing more harm than good.

If he gets the cards paid down things might turn around rather quickly.

[RobertEG]

Be aware that the fact that you wont be on the loan itself wont necessarily preclude the lendor from pulling your credit report, and using it as part of their lending determination.

If he uses your assets or income to qualify for the loan, that also gives rise to their legitimte busness purpose to pull your credit report.

Is your income going to be used to meet any debt/income requirments?

If so, it might be wise to also focus on your score in anticipation of it becoming a consideration.