Looking to buy a home in 6 months

[Anonymous]

Hi guys

New to the forum and looking for some help on getting my credit score at 700+.

Came across this place probably a little bit late, considering that already made some moves in the past month, that might not have been the best ones.

I’ll give you an idea of where things are at this point.

credit karma score

transunion at 697

equifax at 688

myFico score as of right now (not sure of what it was in the past)

Equifax Fico 8 - 632 | Fico 5 - 634

Transunion Fico 8 - 641 | Fico 4 - 650

Experian Fico 8 - 629  | Fico 2 - 621

Old credit cards

2012 Credit One $800

2012 Capital one $1200

2011 Secured US bank credit card $500 (not much use there)

closed Old navy - good payments

closed Victoria secret - some late payments (some stupid mistake)

closed secured capital one credit card

Negative

2009 Bank of America credit card that was defaulted in that period

Picked up by Midland and paid off the collection.

denied for chase freedom and a amex from costco

fair number of hard inquiries from the auto finance loan as well

No opened collections at this point

Cards added this past month

Capital one Quicksilver $2000

Capital one Venture $5000

Amex Delta $1400

Us bank business Plex Travel $3000

A business credit line that should be confirmed in the next day or so

Financed auto for $51k

I can keep most balances at close to 0, but would like to use them for daily purchases for the rewards. Can pay them anytime.

Also got a membership with lexington law to remove some accounts.

Can pay on the auto finance more out from the balance 20 - 30k.

How do you guys advice me to take it from here?

I understand I might have messed up by adding too many accounts recently

[Anonymous]

First of all, cancel Lexington Law. Nothing they can do for you that you can't do yourself. A good month spent on this forum and you will know EXACTLY what to do.

Second, your scores are lower because of your recent app spree but that was a GREAT move as they will rebound and be higher than you started with 6 months from now just by responsibly using your cards. You will max your score by paying all revolving lines to 0 and having <10% UTIL report on ONE card. Now, you don't have to constantly pay the cards. Except Chase, most report to the bureaus only on the statement date once per month. Find out that date for each card (it's usually a couple days after the due date), and only pay a few days before. Then run spend through them again (based on your rewards programs will tell you what to charge on which card). This alone will like give you a large score boost over the following months.

Even though you don't owe anything on the collections and so you don't have any bargaining power anymore, it couldn't hurt to write each company a GW letter explaining why you defaulted (some extenuating circumstances?) and ask them to Remove the collection completely from the report.

Honestly, your scores are fine for an FHA loan and the rest of your profile looks good from a credit perspective. Just make sure you save 2 months of reserves over the next several months and manage your cards well and you will be in super shape in 6 months.

[Anonymous]

Oh and don't use your cash to pay down the car payment YET. Installment loans paid early or more each month makes Little if no difference in your credit scores. If you needed to eek out just a couple points, there is some evidence that paying down all installment loans 10% or so would give a tiny score boost but honestly right now, that cash will serve you better in the bank for a downpayment.

[Anonymous]

Thanks in advance for the advice

My auto financing account is not displayed yet in my reports. Just closed in that a week plus ago.

Will my credit go lower when that get's displayed and it's already lower not due to that being approved?

thank you

[Anonymous]

Mmmmm it's hard to say. It might take a little dip (like 5 points) because it will lower your UTIL and your AAOA (utility on an installment loan is only a very small % of your overall score so won't be a big impact and AAOA is just the avg age of all your open accounts). However, you will get a credit boost which will probably be bigger than the hit for now having a decent mix of types of credit lines. Garden for the next 6 months, pay everything by due dates (except 10% on ONE card) and I would be surprised if your credit score isn't close to 700 within 6 months if not over 700.