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jharp25
Posts: 6
Registered: ‎08-04-2012
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Husband has great credit, my FICO is 590 but high income - should I be on mortgage?

[ Edited ]

My husband and I live in the home that he purchased before we were married.  We are looking to move and purchase another home in the next 8-12 months.  Long story short, I have a bumpy credit history due to late payments (in general, I wasn't very organized).  I had a couple of problems with an American Express corporate card that my company did not pay at the end of 2011 that was drug out for several months, and that dropped my credit score from a 700 in Sept 11 to the 590s where it's hovering now.

 

I am going to do my damnest to pay everything on time from here on out.  I have very low balances on the cards that I have (they are store cards like Vic Secret) I just need to be on top of making payments on them.

 

I am piggy backing on my husband's USAA credit card with avail credit of $25K.  We pay it in full every month.  That gave me a spike initially (that's how it got to 700) but it's been lowered since then.

 

With that being said, I am in medical device sales and my annual income is around 90K.  My husband's income is about $120K with a near perfect credit score.  If we get a mortgage together, and my score is below 700 but my income is high, will I still be an asset to the mortgage?  We are looking to upgrade for our next house and would like to purchase in the $400K-$450K range.

 

Is it possible to get my score up to over 100 points in the next 6-8months?

Am I still an asset on the mortgage with a less than perfect score because of my income? 

I think that he needs my income in order to qualify for the size loan we are seeking.

How much can my score improve if I pay everything on time and make sure that the balances on my cards are very low at all times (less than 20%).

 

Any advice is appreciated.  Btw - I signed up for Sky Blue credit repair today to see if they can do anything about the corporate card/American Express debacle or anything in general.  Hopefully they can help.

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Repo-ed
Posts: 2,953
Registered: ‎02-09-2012
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Re: Husband has great credit, my FICO is 590 but high income - should I be on mortgage?

In short, no.

 

They are going to base approval off lowest mid-scrore between the two of you.

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mschang
Posts: 139
Registered: ‎06-10-2012
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Re: Husband has great credit, my FICO is 590 but high income - should I be on mortgage?

do you have a superhigh DTI? am i crazy or wouldn't a 120K income be enough for a 450K mortgage?

 

i don't have a mortgage myself so that's pure conjecture but i live in california and people with income in the mid-100Ks have much bigger mortgages


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drkaje
Posts: 3,488
Registered: ‎07-25-2008
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Re: Husband has great credit, my FICO is 590 but high income - should I be on mortgage?

Hope Blue Sky isn't costing too much because you're likely stuck with the Amex Charges. The ACM agreements say people will be responsible for their own charges in cases of primary default. Amex ACMs have unique account numbers (with every charge they've made), and can't dispute "not mine" like AUs.

 

FWIW: Amex is known to delete after being paid, if asked nice. Amex ACMs have unique account numbers and can't dispute "not mine".

If Amex were the only negative, and not a ton of money, I'd pay and take former employer to small claims court.


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jharp25
Posts: 6
Registered: ‎08-04-2012
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Re: Husband has great credit, my FICO is 590 but high income - should I be on mortgage?

[ Edited ]

Re the AMex:  Yes, I had no idea that when we were going round and round trying to get the corporate amex paid (my company went through a merger and it was a nightmare), that it would default to my score.  It is paid in full now (as of about March I think) but it still shows on my report for all the past dues and as a "negative" account.

 

Also, no my DTI is not high.  I currently have a VS card (that's the one I kept forgetting I had and didn't pay on time a handful of times), and I only have 2 other cards with balances - a Cap One card with $700 on it (1200 limit) and a Chase card with 1600 on it (2500 limit).  I will be paying both off completely next month. 

 

I use the USAA card that is my husband's - and I'm an authorized user so it reports for me too- for just about all purchases and we pay it off each month...The limit is $25K and we spend about $5K a month on it and pay it off each and every time.  He is a big stickler for that....The only reason the Chase and Cap one cards have balances is because those are the ones I had used after the AMEx closed for business expenses. 

 

I have no idea if my husband can qualify for a $450K loan with a $120K salary.  At the time he bought the house we live in now, I think he made about $65-$75K maybe?  And he qualified for $260K, so I'm not sure.

 

I don't want my husband to be disappointed in me, so I'm really trying to get things on track in the next 6-8 months so we can buy a nicer house... 

 

TBH, I have had 2 miscarriages in the past 9 months and I just totally didn't keep up with the cards and responsibilities that were in my name.  I just didn't care. Couldn't care, at the time.  I wish I could have controlled my actions better but I literally just didn't deal with anything at all.  I am pregnant again, this time with a healthy baby, and I feel awful that what I neglected could affect our ability to move into a nicer house for our baby.

 

I am grateful for all of your advice.  I have totally avoided all things difficult, like my credit score, and I'm really going to try to get it in the right direction now. 

 

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drkaje
Posts: 3,488
Registered: ‎07-25-2008
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Re: Husband has great credit, my FICO is 590 but high income - should I be on mortgage?

You might have success with one of the backdoor numbers.

 

"AmEx:  800-700-7619 (Reserves - handles closed and charged-off accounts)

AmEx Executive Office:  800-297-6197

American Express Credit Bureau Unit:  800-874-2717.  (Must have a current credit report before calling.  They will ask for the account number from the credit report, which is different from your card number.)"

 

I'd start with the executive offices!

 

No idea about other late payments, though. If they're recent FHA might not be an option without goodwill.


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jharp25
Posts: 6
Registered: ‎08-04-2012
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Re: Husband has great credit, my FICO is 590 but high income - should I be on mortgage?

@drkaje: Wow, thank you so much!!! That was so nice of you to provide those numbers! Thank you! I will call on Monday and report back here:smileyhappy:

If I pay off those cards this month, so that the only credit card activity I have is our USAA card that we pay off each month, so zero debt- do you think I could increase my score to a non-embarassing number in a year or less? If there are no late payments bc everything is paid off?

I also read that some lenders take the credit score of the breadwinner into consideration more than the co-applicant with lesser income. Is this true? Is there any way that my husband's credit/history could be weighed more heavily than mine? But we could still "use" my income for a mortgage?

Thank you again for all of your insight. My husban works offshore and is gone a lot, so I am tending to fixing my credit by myself, and your advice is very much appreciated!
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webhopper
Posts: 7,230
Registered: ‎09-16-2011
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Re: Husband has great credit, my FICO is 590 but high income - should I be on mortgage?

Your scores will be weighed the same. For what its worth; your baby really wont care about what kind of house you live in until he/she hits about 4th or 5th grade; at least that has been my experience. I know how it is to want to have the perfect "nest" for your kiddo.... and ya an upgrade in house would be awesome; but I think you'll be fine in a year or two if you stay on top of payments.

You should definately do as others suggested and try to clean up your reports as best you can. Your goal should definately be attainable as you have good compensating factors... just keep working on those goodwill letters and amex goodwill.

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webhopper
Posts: 7,230
Registered: ‎09-16-2011
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Re: Husband has great credit, my FICO is 590 but high income - should I be on mortgage?

Also; given your husbands strong relationship with usaa; he should call them and ask score requirements and ask about allowable front and back end ratios. They may allow him to take out the loan in his own name; with your income although not being used on the actual application; it would be a strong compensating factor for allowing a higher ratio on the front end. That's where I would start; usaa should be able to give you guys an idea about what steps you need to take in order to qualify for the loan. If your husband is a veteran; he should look at va loans

Starting Score: 08/29/2011 TU 671 EQ 674
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webhopper
Posts: 7,230
Registered: ‎09-16-2011
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Re: Husband has great credit, my FICO is 590 but high income - should I be on mortgage?

Va loans allow for higher ratios...

Starting Score: 08/29/2011 TU 671 EQ 674
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